Suppose that proposal 1 and 3 are mutually exclusive, project 2 is contingent on project 1. The budget limit is $130,000.
|
|
Project 1
|
Project 2
|
Project 3
|
|
Investment
|
65,000
|
58,000
|
93,000
|
|
Annual Revenue
|
23,000
|
19,500
|
29,000
|
|
Annual Cost
|
5,000
|
4,500
|
6,000
|
|
Salvage Value
|
|
10,000
|
15,000
|
1. Develop the matrix of investment alternatives, indicate which one is not feasible, and give reasons for the infeasibility
2. Develop the composite cash flows for the feasible alternatives
3. Suppose the MARR is 10%, determine the best alternative using Present Worth on total investment.