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Management is trying to decide whether or not to build a new factory. They believe sales are increasing for their products. They have estimated revenues of $85,000 in year one, $70,000 in years two through ten. In 10 years the factory is obsolete. They estimate expenses annually to operate the factory after year 1 would be $35,000. The cost of the new factory is $400,000. The payments required are $120,000 immediately with the remainder due at completion. The company has hurdle rate of 10%. Use these tables to solve the problems. Present value of $1 Present value of an annuity Management is trying to decide whether or not to build a new factory. They believe sales are increasing for their products. They have estimated revenues of $85,000 in year one, $70,000 in years two through ten. In 10 years the factory is obsolete. They estimate expenses annually to operate the factory after year 1 would be $35,000. The cost of the new factory is $400,000. The payments required are $120,000 immediately with the remainder due at completion. The company has hurdle rate of 10%. Use these tables to solve the problems. Management is trying to decide whether or not to build a new factory. They believe sales are increasing for their products. They have estimated revenues of $90,000 in year one, $75000 in years two through ten. In 10 years the factory is obsolete. They estimate expenses annually to operate the factory after year 1 would be $30000. The cost of the new factory is $350,000. The payments required are $80,000 immediately with the remainder due at completion. The company has hurdle rate of 8%. Use these tables 7 to solve the problems. a) PV factor for years 210 is the different of 10 periods - 1 period for the indicated % b) PV factor for years 2-9 is the different of 9 periods - 1 period for the indicated %