A firm that purchases electricity from the local utility for $250,000 per year is considering installing a steam generator at a cost of $280,000. The cost of operating this generator would be $170,000 per year, and the generator will last for five years. If the firm buys the generator, it does not need to purchase any electricity from the local utility. The cost of capital is 9%. For the local utility option, consider five years of electricity purchases. For the generator option, assume immediate installation, with purchase and operating costs in the current year and operating costs continuing for the next four years. Assume payments under both options at the start of each year (i.e., immediate, one year from now,…, four years from now). What is the net present value of the more attractive choice? Please round your answer to the nearest dollar. Report the NPV of cost as a negative number.
In your assessment task 3, you will be required to choose a press release from a reputable English-medium newspaper and summarise it and then write an
In your assessment task 3, you will be required to choose a press release from a reputable English-medium newspaper and summarise it and then write an essay to analysing the press release’s impact on Australian consumers, linking economic theory, policy and principals.This assessment is aimed to evaluate your ability to
