Lignin is a basic component of almost any plant that grows, so it is one of the most abundant organic compounds in the world Almost anything derived from oil can be made out of lignin The question is "can do it cost-effectively and consistently?" A startup company has developed a process to derive plastics, carbon fiber and other advanced materials from lignin. The cash flow diagram for this process is shown below (in $ millions) If the company's hurdle rate (MARR) is 19% per year, is this a profitable undertaking? Click the icon to view the diagram for cash flows Click the icon to view the interest and annuity table for discrete compounding when the MARR is 19% per year More Info The present worth of the venture is $☐ million (Round to two decimal places) According to the PW Decision Rule, the investment economically justified. Q 90 75 a 60 C 45 30 15 A 2 A 4 5 6 7 8 15 ΕΟΥ 30 45 - X

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
icon
Related questions
Question
None
Lignin is a basic component of almost any plant that grows, so it is one of the most abundant organic compounds in the world Almost anything derived from oil can be made out of lignin The question is "can we
do it cost-effectively and consistently?" A startup company has developed a process to derive plastics, carbon fiber and other advanced materials from lignin. The cash flow diagram for this process is shown
below (in $ millions) If the company's hurdle rate (MARR) is 19% per year, is this a profitable undertaking?
Click the icon to view the diagram for cash flows
Click the icon to view the interest and annuity table for discrete compounding when the MARR is 19% per year
The present worth of the venture is $ million (Round to two decimal places.)
According to the PW Decision Rule, the investment
economically justified.
More Info
1
216
15
30
45
90
75
60
45
30
15
A
3
4
5
6 7
8
9
EOY
- X
Transcribed Image Text:Lignin is a basic component of almost any plant that grows, so it is one of the most abundant organic compounds in the world Almost anything derived from oil can be made out of lignin The question is "can we do it cost-effectively and consistently?" A startup company has developed a process to derive plastics, carbon fiber and other advanced materials from lignin. The cash flow diagram for this process is shown below (in $ millions) If the company's hurdle rate (MARR) is 19% per year, is this a profitable undertaking? Click the icon to view the diagram for cash flows Click the icon to view the interest and annuity table for discrete compounding when the MARR is 19% per year The present worth of the venture is $ million (Round to two decimal places.) According to the PW Decision Rule, the investment economically justified. More Info 1 216 15 30 45 90 75 60 45 30 15 A 3 4 5 6 7 8 9 EOY - X
Expert Solution
steps

Step by step

Solved in 3 steps with 1 images

Blurred answer
Knowledge Booster
Decision Tree
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
Economics
ISBN:
9780190931919
Author:
NEWNAN
Publisher:
Oxford University Press
Principles of Economics (12th Edition)
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (MindTap Course List)
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Managerial Economics: A Problem Solving Approach
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-…
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education