Question: Company ABC is considering investing in a project whose initial cost is $187000. It saves $49000 in the first year, increasing by $5800 each year

Company ABC is considering investing in a project whose initial cost is $187000. It saves $49000 in the first year, increasing by $5800 each year thereafter. The salvage value of the project is $13500 at the end of year 7. The cost of operating and maintenance in the first year is $3600, increasing by 3% each year thereafter. The company wants to see if the project is worth to be invested in. To help ABC to decide, you should find the present worth (PW) of the project. The company's MARR is 11%.

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