Rex Electric has decided to move into low-rise ( 2 to 8 floors) commercial building electrical wiring. After great success in upscale residential and small commercial wiring, they have identified four independent and indivisible investments, any or all of which will help make the move to the next level. Rex Electric's MARR is 10 percent, and \(\$ 500,000\) is available for investment immediately, with \(\$ 175,000\) available for follow-up investment the next year.

a. Which alternatives should be selected by Rex Electric?

b. What is the present worth for the selected investment portfolio?

c. What is the IRR for the optimum portfolio?

Using SOLVER for sensitivity analaysis,

d. determine the optimum portfolio (state the investments selected and the portfolio PW) using (1) the current limit on investment capital, (2) plus 20 percent, and (3) minus 20 percent.

e. determine the optimum portfolio (state the investments selected and the portfolio PW) using (1) the current MARR, (2) plus 20 percent, and (3) minus 20 percent.

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EOY CF(1) CF(2) CF(3) CF(4) 0 -$50,000 -$125,000 -$200,000 -$250,000 1 -$100,000 -$75,000 $50,000 $75,000 2 $50,000 $70,000 $50,000 $75,000 3 $50,000 $70,000 $50,000 $75,000 4 $50,000 $70,000 $50,000 $75,000 5 $50,000 $70,000 $75,000 $75,000 6 $50,000 $70,000 $75,000 $85,000 7 $50,000 $70,000 $75,000 $85,000 8 $50,000 $70,000 $75,000 $85,000 9 $50,000 $70,000 $75,000 $85,000 10 $75,000 $100,000 $75,000 $100,000