$6.$ Individual Problems $5-4$

A university spent $$1\mathrm{.}3$ million to install solar panels atop a parking garage. These panels will have a capacity of $300$ kilowatts $($kW$)$ and have a life expectancy of $20$ years. Suppose that the discount rate is $30\%,$ that electricity can be purchased at $$0\mathrm{.}10$ per kilowatt$-$hour $($kWh$),$ and that the marginal cost of electricity production using the solar panels is zero.

Hint: It may be easier to think of the present value of operating the solar panels for $1$ hour per year first.

Approximately how many hours per year$$will the solar panels need to operate to enable this project to break even?

$6,534\mathrm{.}64$

$13,069\mathrm{.}27$

$16,990\mathrm{.}05$

If the solar panels can operate only for $11,762$ hours a year at maximum, the project$$break even.

Continue to assume that the solar panels can operate only for $11,762$ hours a year at maximum.

In order for the project to be worthwhile $($i$.$e$.,$ at least break even$),$ the university would need a grant of at least$$