Answer= 10-16 A robot has just been installed at a cost of $81.00, 10-16 A robot

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Answer=
10-16 A robot has just been installed at a cost of $81.00, 10-16 A robot has just been installed at a cost of $81,000 A It will have no salvage value at the end of its useful life. Savings per Year Probability Life (years) Probability $18,000 20,000 22,000 Useful 25% 0.2 0.7 0.1 1/6 2/3 1/6 12 4 (a) What is the joint probability distribution for savings per year and useful life? (b) Define optimistic, most likely, and pessimistic scenarios by using both optimistic, both most likely, and both pessimistic estimates. What is the rate of return for each scenario?

Explanation / Answer

Saving/Year /Usefull life 12 5 4 18,000 =0.2*1/6 = 0.033 0.2*2/3 = 0.134 =0.2*1/6 = 0.033 20,000 0.7*1/6 = 0.117 0.7*2/3 = 0.466 0.7*1/6 = 0.117 22,000 0.1*1/6 = 0.017 0.1*2/3 = 0.066 0.1*1/6 = 0.017

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