Acme corporation is considering two alternative injection molding machines, and MARR IS 15% per year. Plot the sensitivity of each alternative in Excel for the following three cases of varying Net Annual Revenue (NAR), where NAR = Annual Revenues - Annual Expenses: -50% 0% +100% Using annual worth (AW) analysis, which alternative has higher sensitivity to the Net Annual Revenue (NAR)? Show computations and paste an Excel spider chart. Item Alternative A Alternative B $500,000 $150,000 $75,000 $50,000 $375,000 $130,000 $80,000 $37,000 Capital investment Annual revenue Annual expenses Salvage value Useful life 5 vears 6 vears
Acme corporation is considering two alternative injection molding machines, and MARR IS 15% per year. Plot the sensitivity of each alternative in Excel for the following three cases of varying Net Annual Revenue (NAR), where NAR = Annual Revenues - Annual Expenses: -50% 0% +100% Using annual worth (AW) analysis, which alternative has higher sensitivity to the Net Annual Revenue (NAR)? Show computations and paste an Excel spider chart. Item Alternative A Alternative B $500,000 $150,000 $75,000 $50,000 $375,000 $130,000 $80,000 $37,000 Capital investment Annual revenue Annual expenses Salvage value Useful life 5 vears 6 vears
Chapter11: Capital Budgeting Decisions
Section: Chapter Questions
Problem 17EB: Caduceus Company is considering the purchase of a new piece of factory equipment that will cost...
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