D Question 9 6 pts Supoose that a 2MW wind burbine can be pu

D Question 9 6 pts Supoose that a 2MW wind burbine can be purchased and installed lover a 1 year time periodl for $2 Million with a 25 vear operating l ile. The operacing cost is $100k per year The capacity production per year is 40% and klowatt hour is $0.04 Assume that the interest rate is 7.0 What is the net grofit or loss after 25 years? Please select the conect inswer from options lal to e d 207190 -552 33

Solution

The correct choice is :- None of the above

2MW = 2000 KW

The unit is operating at 40% capacity i.e. its capacity production is 800 KW of power.

The present value of the cash flows = - $2,792,443.66

Year	Cash outflows	Cash Inflows	Net cash flows	Present value cash flows
0	$2,000,000	$0.00	($2,000,000)	($2,000,000.00)
1	$100,000	$32,000.00	($68,000)	($63,551.40)
2	$100,000	$32,000.00	($68,000)	($59,393.83)
3	$100,000	$32,000.00	($68,000)	($55,508.26)
4	$100,000	$32,000.00	($68,000)	($51,876.87)
5	$100,000	$32,000.00	($68,000)	($48,483.06)
6	$100,000	$32,000.00	($68,000)	($45,311.27)
7	$100,000	$32,000.00	($68,000)	($42,346.98)
8	$100,000	$32,000.00	($68,000)	($39,576.62)
9	$100,000	$32,000.00	($68,000)	($36,987.49)
10	$100,000	$32,000.00	($68,000)	($34,567.75)
11	$100,000	$32,000.00	($68,000)	($32,306.31)
12	$100,000	$32,000.00	($68,000)	($30,192.81)
13	$100,000	$32,000.00	($68,000)	($28,217.58)
14	$100,000	$32,000.00	($68,000)	($26,371.57)
15	$100,000	$32,000.00	($68,000)	($24,646.33)
16	$100,000	$32,000.00	($68,000)	($23,033.95)
17	$100,000	$32,000.00	($68,000)	($21,527.06)
18	$100,000	$32,000.00	($68,000)	($20,118.75)
19	$100,000	$32,000.00	($68,000)	($18,802.57)
20	$100,000	$32,000.00	($68,000)	($17,572.49)
21	$100,000	$32,000.00	($68,000)	($16,422.89)
22	$100,000	$32,000.00	($68,000)	($15,348.50)
23	$100,000	$32,000.00	($68,000)	($14,344.39)
24	$100,000	$32,000.00	($68,000)	($13,405.97)
25	$100,000	$32,000.00	($68,000)	($12,528.94)