Reconsider the data from Problem 4. Management has expressed some concern over the life of the project and the impact of possible early termination. As a result, you have developed additional data based on three possible salvage value scenarios. In each case, the possible salvage values progress from \(\$ 70,000\) at EOY 0 to \(\$ 2,000\) at EOY 

Case 1 is based on a schedule provided by the vendor as shown below. 

Case 2 is based on a gradient series decline. Case 3 is based on a geometric series decline.

a. Determine the salvage decline rate for the gradient case.

b. Determine the salvage value decline rate for the geometric case.

c. Determine the annual worth for each case for each planning horizon from 1 to 6 by 1.

d. Plot a graph similar to Figure 7.1 depicting your results from c.

Data from problem 4

A project has been selected for implementation. The net cash flow (NCF) profile associated with the project is shown below. MARR is 10 percent/year.

EOY 0 2 3 4 5 6 NCF -$70,000 $30,000 Vendor SV $70,000 $50,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $20,000 $10,000 $5,000 $2,000