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What is the pw, aw, and fw of this proposal

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Question - You are faced with making a decision on a large capital investment proposal. The capital investment amount is $640,000. Estimated an annual revenue at the end of each year in the eight-year study period is $100,000. The estimated annual year-end expenses are $42,000 starting in year one. These expenses begin decreasing by $4,000 per year at the end of year tour and continue decreasing through the end of year eight Assuming a $20,000 market value at the end of year eight and a MARE = 12% per year, answer the following questions.

a. What is the PW, AW, and FW of this proposal?

b. What is the IRR, and ERR of this proposal?

c. What is your conclusion about the acceptability of this proposal?

Reference no: EM133188271

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