What is the present and future worth of the project

Assignment Help Financial Management

Reference no: EM131979540

Southern ontario is planning to build a new solar power station the project will start in 2023 and is planned to take 3 years at a cost of $150 million per year. After project completion, the cost of maintenance and repairs is expected to be $10 million for the first year, and to increase by $100,000 per year thereafter. The salvage value of the station at the end of year 2060 is estimated to be $30 million. The new solar station is expected to save the city $45 million per year. Consider the present to be the end of 2016/beginning of 2017 and the interes rate to be 6%

Draw the cash flow for this project from present till end of 2060, What is the present and future worth of the project? Is it a good invesment for the city to make?

Reference no: EM131979540

Questions Cloud

What would be considered good debt-equity and cash flow : what would be considered good debt, equity, and cash flow percentages for a company to target.

Determine the financial effect of dropping product b : Clinton Company sells two items , product A and product B. Prepare an incremental analysis to determine the financial effect of dropping product B

Amount of american assets bought by foreigners : Suppose that Americans buy more foreign assets than the amount of American assets bought by foreigners.

Prepare the journal entries for the transactions : Prepare the journal entries for the following transactions: Increase in the spot price of gold on June 30 & September 30

What is the present and future worth of the project : Draw the cash flow for this project from present till end of 2060, What is the present and future worth of the project?

Compute the basic and diluted earning per share : Bragg issued $1,500,000 of 10% convertible bonds at face value during 2012. REQUIRED - Compute the basic and diluted earning per share for 2013

Fund each year in order to meet its sinking fund obligations : How much must the firm deposit into the fund each year in order to meet its sinking fund obligations?

What will his total cost recovery deduction : If Preston wishes to maximize his total 2013 cost recovery deduction, what will his total cost recovery deduction be on the properties purchased in 2013

Compute the bond yield to maturity : Compute the bond’s yield to maturity. Determine the value of the bond to you, given your required rate of return.

User Account

All Pages