Question: please help me with this question Oakville Hydro has two options for upgrading a hydro-electric power station to meet new government standards. Option 1: Oakville



please help me with this question
Oakville Hydro has two options for upgrading a hydro-electric power station to meet new government standards. Option 1: Oakville Hydro will make the upgrades themselves. This is expected to cost $11,600 at the end of every six months for 15 years. At the end of the operation (in 15 years) Oakville Hydro expects to sell all equipment needed for the upgrade for $113,000, Option 2: Pay experienced contractors. This will cost $43,000 up front and $12,700 semi-annually for 11 years. Assume all interest is 3.88% compounded semi-annually. Round the answers to NPV (Option 1), and NPV (Option 2) to the nearest dollar. Round all other answers to two decimal places where applicable. 1) Find the net present value of option 1: Payments (Cost) Sale of equipment (Residual) P/Y = C/Y = N 1/Y = 90 % PV = $ PMT = $ S FV = $ $ (If the NPV is negative, enter it as a negative number. If the NPV is zero, enter 0.) NPV (Option 1) = $ 2) Find the net present value of option 2 Payments (Cost) PHY CAY N 1/Y 06 PV S PMT 5 FV S (If the NPV is negative, enter it as a negative number. If the NPV is zero, enter 0.) NPV (Option 2) = 5 3) Which option should Oakville Hydro choose
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