IN EXCEL!! A certain public library is evaluating the possibility of investing in equipment and licenses to provide its userswith access to e-books. To achieve this, they will need to invest $53,000 in building renovations, including wiring. Theywill need to purchase equipment at a cost of $21,000 and make an initial investment of $1.7 million in electronicvolumes, which will also require $1 million annually for maintenance. To evaluate this public project, an interest rate (i) of8% and a planning horizon of 15 years will be used. At the end of that period, it is estimated that the buildingrenovations will have a residual value equivalent to 30% of the original investment. The residual value of the equipmentand other acquisitions will be negligible at the end of 10 years. It is estimated that the acquisition of this new system willlead to about 10,500 "visits" per year in the first year, increasing by 500 visits each year. The benefits for the users of thisproject are estimated at $7.00 per visit. Use a cost-benefit analysis to determine if the project is justified. What is theminimum benefit per visit that must be received from the project to justify it?

Part 2: Explanation:Step 1: Calculating the initial investment costs is crucial to understanding the…

Answered: IN EXCEL!! A certain public library is…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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I want you to make a cash flow diagram on the given problem below. Only the Cash Flow Diagram (CFD), i am not asking you to solve it.
PLEASE SHOW YOUR EXCEL FORMULASQUESTION: Consider two mutually exclusive investment alternatives given in the table below. Which project would be selected based on the rate of return decision (IRR) criterion? (Assume that MARR is 10%.). Hint: RIC Determine the MIRR on the incremental investment. Which project would be chosen at MARR = 10%? Provide your answer in a table with column headers N (year), A1 cash flow, A2 cash flow, A2-A1 cash flow. n Project A1 Cash Flow Project A2 Cash Flow 0 -$12,000 -$15,000 1 $7,500 $8,000 2 $7,500 $14,000 3 $7,500 $5,000 IRR 39.45% 38.27%

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