What is the expected annual savings

Reference no: EM13549215

An energy efficiency project has a first cost of $300,000, A life of 10 years, and no salvage value. Assume that the interest rate is 9%. The most likely value for annual savings is $60,000. The optimistic value for annual savings is $80,000 with a probability of 0.2. The pessimistic value is $40,000 with a probability of 0.3.

a) What is the expected annual savings?

b) The expected PW?

Reference no: EM13549215

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