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In: Finance
An energy farm invests in solar panels with installation costs of $2 million today. The farm...
An energy farm invests in solar panels with installation costs of $2 million today. The farm expects to have net inflows of $60,000 a year for the next 20 years and $50,000 a year for 20 years after that (total of 40 years). Calculate the payback, IRR, and NPV for the solar panels. Assume a discount rate of 4.3%.
Solutions
jeff jeffy answered 4 months agoRelated Solutions
Solar-Tex is a new high-tech company producing solar panels. It expects earnings of $2 million in...
Solar-Tex is a new high-tech company producing solar panels. It
expects earnings of $2 million in its first year of operation. Its
earnings are expected to grow at 25% per year for the next 6 years.
Analysts are convinced that after this period of high growth,
earnings will only grow at 4% per year forever due to other
competitors entering the market. If the annual interest rate (EAR)
is 8%, what is the total present value of Solar-Tex's future
earnings?...
Solar-Tex is a new high-tech company producing solar panels. It expects earnings of $2 million in...
Solar-Tex is a new high-tech company producing solar panels. It
expects earnings of $2 million in its first year of operation. Its
earnings are expected to grow at 25% per year for the next 6 years.
Analysts are convinced that after this period of high growth,
earnings will only grow at 4% per year forever due to other
competitors entering the market. If the annual interest rate (EAR)
is 8%, what is the total present value of Solar-Tex's future
earnings?...
Solar Power Ltd., a small Kumasi –based manufacturer and distributor of solar energy panels, was in...
Solar Power Ltd., a small Kumasi –based manufacturer
and distributor of solar energy panels, was in its first year of
operation. The company was conceived and controlled by two retired
executives. Nana Darkwa, an engineer by profession, developed the
basic patent for the solar panels. He lacked adequate liquid
resources to finance the venture, although he did control a fair
amount of wealth. Yaw Manu’s chosen field of endeavor was real
estate. He, too, possessed few pied real property including...
A university spent $1.6 million to install solar panels atop a parking garage. These panels will...
A university spent $1.6 million to install solar panels atop a
parking garage. These panels will have a capacity of 800 kilowatts
(kW) and have a life expectancy of 20 years. Suppose that the
discount rate is 30%, that electricity can be purchased at $0.30
per kilowatt-hour (kWh), and that the marginal cost of electricity
production using the solar panels is zero. Hint: It may be easier
to think of the present value of operating the solar panels for 1...
Hudson contracted with Ripley to install solar panels on her boat. The installation went well, seemingly....
Hudson contracted with Ripley to install solar panels on her
boat. The installation went well, seemingly. Unfortunately, two
days after the installation the panels stopped working. Ripley
claimed that the problem was Hudson's fault, and demanded that he
make the system work; Hudson denied responsibility. Ripley had paid
Hudson by properly executed check, and Hudson still had not
deposited the check at the time of Ripley's demand. The day after
receiving the demand, Hudson negotiated the apparently-regular,
unaltered check to...
An array of solar panels was purchased and placed in service by a energy company. Its...
An array of solar panels was purchased and placed in service by
a energy company. Its cost basis is $60,000, and it has an
estimated MV of $1,000 at the end of an estimated useful life of 10
years. Compute the book value (BV) at the end of the array's eighth
year of life when using the DB method with switchover to SL and a
DB ratio of 200%. Express your answer in terms of dollars and
cents, rounded to...
Installing Tesla solar panels in a house costs $18,000. It is expected that the average monthly...
Installing Tesla solar panels in a house costs $18,000. It is
expected that the average monthly savings will be 1,000 kWh per
month. Assuming that the utility company charges 0.2 per
$/kWhr.
What is the Present worth of this investment for i=6% and N=15
years?
A different approach could be to install energy efficient
windows and enhance the insulation for $12,000, which would yield
average monthly savings of 700 kWh per month. Assuming the same
interest rate and time span....
Passive and active solar energy systems are becoming viable options to home builders as installation and...
Passive and active solar energy systems are becoming viable
options to home builders as installation and operating costs
decrease. Laminated solar modules utilize high-quality,
single-crystal, silicon solar cells, connected electrically in
series, to deliver a specified power output. Research was conducted
to investigate the relationship between the solar cell temperature
(°C) rise above ambient and the amount of insulation (megawatts per
square centimeter). Data collected for six solar cells sampled
under identical experimental conditions are recorded in the table
attached....
2. Suppose the (inverse) market demand for solar panels is p= 1500 − 20Q and the...
2. Suppose the (inverse) market demand for solar panels is p=
1500 − 20Q and the (inverse) market supply is p= 10Q
a. Find the competitive market equilibrium price and quantity.
b. Each solar panel sold reduces pollution by 1 unit, and each
unit reduction in pollution has a benefit of $300 to the rest of
society. What is the optimal quantity of solar panels for
society?
c. What is the deadweight loss to society of the competitive
equilibrium outcome?...
Today (year 0) a new 7-megaWatt (MW) solar panel farm is constructed at a cost of...
Today (year 0) a new 7-megaWatt (MW) solar panel farm is
constructed at a cost of MYR14 million. 4 years from today, a
smaller 6-MW solar farm will be added to the existing farm. The
inflation rate on solar panel construction projects averages 8% per
year. If the cost-capacity factor is 0.85 for solar panel
construction, what is the estimated capital investment for the
smaller 6-MW solar farm?
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