Consider the following two new chemical plants, each with an initial fixed capital investment (year 0) of

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Consider the following two new chemical plants, each with an initial fixed capital investment (year 0) of $15 × 106. Their cash flows are as follows:Year Process 1 (Smillion/y) Process 2 (Smillion/y) 1 5.0 2 5.0 5.0 5.0 5.0 3.0 8.0 3 7.0 4 5.0 5 2.0

Calculate the NPV of both plants for interest rates of 6% and 18%. Which plant do you recommend? Explain your results.

Calculate the DCFROR for each plant. Which plant do you recommend?

Calculate the nondiscounted payback period (PBP) for each plant. Which plant do you recommend?

Explain any differences in your answers to Parts (a), (b), and (c).

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Analysis Synthesis And Design Of Chemical Processes

ISBN: 9780134177403

5th Edition

Authors: Richard Turton, Joseph Shaeiwitz, Debangsu Bhattacharyya, Wallace Whiting

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