What is the pw at specialty interest rate

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Question: In Problem, how fast would revenue have to fall (or increase) for the PW to be $0?

Problem: Specialty Chemicals has a new plastic formulation that should have a market life of 10 years. First costs will be $15M. Initial raw materials costs will be $4.3M per year, with a constant 3% rate of increase. Production costs for labor, energy, and facility maintenance are $1.8M per year initially, with a 2% rate of increase as the facility ages. If revenue is constant at $11M per year, what is the PW at Specialty's interest rate of 10%?

Reference no: EM132158689

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