A high pressure turbine in a gas power plant has the following net cash flows and abandonment values over its useful life (see Table P9 15) The firm 's MARR is 12 per year Determine the optimal time for the turbine to be abandoned if its current MV is $25,000 and it won 't be used for more than fou...

Abandonment Interval Keep for N 1 year PW10 7500 6200 2000PF101 45 Keep for N 2 ...

A high pressure turbine in a gas power plant has the following net cash flows and abandonment

Question:

A high pressure turbine in a gas power plant has the following net cash flows and abandonment values over its useful life (see Table P9-15).
The firm's is 12% per year. Determine the optimal time for the turbine to be abandoned if its current MV is $25,000 and it won't be used for more than four years.
MARR
Minimum Acceptable Rate of Return (MARR), or hurdle rate is the minimum rate of return on a project a manager or company is willing to accept before starting a project, given its risk and the opportunity cost of forgoing other...