耶蘇 2022-11-17 10:49
Waterloo North Hydro has two options for upgrading a hydro-electric power station to meet new government standards.
Option 1: Waterloo North Hydro will make the upgrades themselves. This is expected to [b]cost[/b] $12,900 at the end of every six months for 13 years. At the end of the operation (in 13 years) Waterloo North Hydro expects to [b]sell all equipment[/b] needed for the upgrade for $116,000.
Option 2: Pay experienced contractors. This will [b]cost[/b] $40,000 up front and $11,600 semi-annually (at the end of every six months) for 13 years.
Assume all interest is 3.26% compounded semi-annually.
NPV (Option 1) = ?
NPV (Option 2) = ?
Which option should Waterloo North Hydro choose?
fb2d905c69ae04 2023-2-11 15:47
[quote]原帖由 [i]耶蘇[/i] 於 2022-11-17 10:49 發表 [url=https://www.discuss.com.hk/redirect.php?goto=findpost&pid=553780024&ptid=30863923][img]https://www.discuss.com.hk/images/common/back.gif[/img][/url]
Waterloo North Hydro has two options for upgrading a hydro-electric power station to meet new government standards.
Option 1: Waterloo North Hydro will make the upgrades themselves. This is expecte ... [/quote]
Just set the cash (outflow)/inflow on time line and calculate.
3.26% interest is per annum or semi-annually?