What is the pw at specialty

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Reference no: EM131807455

Specialty Chemicals has a new plastic formulation that should have a market life of 10 years. First costs will be $15M. Initial raw materials costs will be $4.3M per year, with a constant 3% rate of increase. Production costs for labor, energy, and facility maintenance are $1.8M per year initially, with a 2% rate of increase as the facility ages. If revenue is constant at $11M per year, what is the PW at Specialty's interest rate of 10%? (Answer: $11.06M)

Reference no: EM131807455

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