Compare the new outcomes with those of chapter

Reference no: EM13899338

1. A hypothetical problem description may be given as follows:

ADJO Prison Industries uses inmate labor to sell a variety of items. The cash flows from these items are used to support the payment of operating costs and to generate supplemental cash flows within the prison setting. ADJO seeks to possibly expand its revenue streams via the potential of producing and selling additional furni- ture items. Specifically, ADJO is considering the producing and selling of futons, mattresses, chairs, sofas, and recliners as methods of obtaining its desired additional revenue streams. Assuming a 3.00% rate, the expected cash flows of these potential projects are given in Table 12.6.

Given these cash flows and rate, perform a sensitivity analysis for the following items:

• Analysis 1: Alter the year 7 futons cash flows to a value of $27,978.33. Compare the new outcomes with those of Chapter

2. How does this change affect decisions within the universe of discourse?

• Analysis 2: Alter the mattresses cash flows as in Table 12.7.

Calculate the new NPW. Compare the new outcomes with those of Chapter 7. How does this change affect decisions within the universe of discourse?

Text Book: Economic and Financial Analysis for Criminal Justice Organizations By Daniel Adrian Doss, William H. Sumrall III, David H. McElreath, Don W. Jones.

Reference no: EM13899338

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