A manufacturing company is considering installing a heat recovery system to help offset their energy cost for heating.
- The investment cost is $150,000
- The estimated energy cost savings is 38% with the heat recovery system
- The current energy cost for heating is $5,000 per mont
- The current government subsity for this kind fo energy conservation investment is 25% (meaning the company's effective investment cost is reduced by 25%)
- The company's interest rate is 3%
Determine the sensitivity of the breakeven point in changes to the following:
-Changes in the government subsity down to 0% and up to 50%
-Changes in the company's interest rate down to 2% and up to 6%
-Changes in energy saving +/- 25%