Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Installing low thermal emissivity windows (low-e windows) on buildings can contribute to energy conservation. Installing low-e
windows on a school building is estimated to cost $10,000. The windows are expected to last 6 years and have no salvage value at that
time. The energy savings from the windows are expected to be $2,525 in the 1st year. After the 1st year, the savings are expected to
increase by $125 each year due to escalating fossil fuel costs. MARR is 15% per year and annual worth is the preferred measure of
economic worth. Which Excel® entry should you use to determine the annual worth of installing the low-e windows?
-NPV (15 %,6,10000)+NPV( 15%,6,- NPV ( 15%,2525,25252525,2525,25252525))
O-PMT( 15%,6,10000) + PMT( 15 %,6,- NPV ( 15%, 0,125,2 125,3 125,4 125,5*125))+2525
O-PMT(15,6,10000)+PMT(15,6,PMT(15,0,125,2 125,3 125,4*125,5*125))+2525
-PMT(15%.6.10000)+PMT (15% , 6 , NPV ( 15%, 2525,2 2525,2525,2525,2525))
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Transcribed Image Text:Installing low thermal emissivity windows (low-e windows) on buildings can contribute to energy conservation. Installing low-e windows on a school building is estimated to cost $10,000. The windows are expected to last 6 years and have no salvage value at that time. The energy savings from the windows are expected to be $2,525 in the 1st year. After the 1st year, the savings are expected to increase by $125 each year due to escalating fossil fuel costs. MARR is 15% per year and annual worth is the preferred measure of economic worth. Which Excel® entry should you use to determine the annual worth of installing the low-e windows? -NPV (15 %,6,10000)+NPV( 15%,6,- NPV ( 15%,2525,25252525,2525,25252525)) O-PMT( 15%,6,10000) + PMT( 15 %,6,- NPV ( 15%, 0,125,2 125,3 125,4 125,5*125))+2525 O-PMT(15,6,10000)+PMT(15,6,PMT(15,0,125,2 125,3 125,4*125,5*125))+2525 -PMT(15%.6.10000)+PMT (15% , 6 , NPV ( 15%, 2525,2 2525,2525,2525,2525))
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