A Continuous Improvement Has Helped a Company to Raise Savings$$\begin{array} { | l | l | }
\hline \text { Annual Benefit } & \text { Probability } \
\hline \$ 15.000 & 0.25 \
\hline \$ 20,000 & 0.45 \
\hline \$ 25,000 & 0.3 \
\hline
\end{array}$$

Question

A Continuous Improvement Has Helped a Company to Raise Savings$$\begin{array} { | l | l | } 
\hline \text { Annual Benefit } & \text { Probability } \
\hline \$ 15.000 & 0.25 \
\hline \$ 20,000 & 0.45 \
\hline \$ 25,000 & 0.3 \
\hline
\end{array}$$

Examlex · Accepted Answer

The Answer is

\begin{array} { | c | c | c | c | c | l | } \hline ext { Arrual Benefit } & ext { Prob. } & ext { Life } & ext { Prob. } & ext { Joirt Prob. } & { \mathrm { NPW } } \\hline \$ 15.000 & 0.25 & 5 & 0.6 & 0.15 & \begin{array} { l } \{ 15,000 ( \mathrm { P } / \mathrm { A } , 10 \% , 5 ) - 50,000 \} [ 0.15 ] \= \{ 15,000 ( 3.791 ) - 50,000 \} [ 0.15 ] \= \$ 1,029.75\end{array} \\hline \$ 20,000 & 0.45 & 5 & 0.6 & 0.27 & \begin{array} { l } = \{ 20,000 ( 3.791 ) - 50,000 \} [ 0.27 ] \= \$ 6,971.4\end{array} \\hline \$ 25,000 & 0.3 & 5 & 0.6 & 0.18 & \begin{array} { l } = \{ 25,000 ( 3.791 ) - 50,000 \} [ 0.18 ] \= \$ 8,059.5\end{array} \\hline \$ 15.000 & 0.25 & 3 & 0.4 & 0.10 & \begin{array} { l } \{ 15,000 ( \mathrm { P } / A , 10 \% , 3 ) - 50,000 \} [ 0.10 ] \= \{ 15,000 ( 2.487 ) - 50,000 \} [ 0.10 ] \= - \$ 1,269.5\end{array} \\hline \$ 20,000 & 0.45 & 3 & 0.4 & 0.18 & \begin{array} { l } = \{ 20,000 ( 2.487 ) - 50,000 \} [ 0.18 ] \= - \$ 46.8\end{array} \\hline \$ 25,000 & 0.3 & 3 & 0.4 & 0.12 & \begin{array} { l } = \{ 25,000 ( 2.487 ) - 50,000 \} [ 0.12 ] \= \$ 1,461\end{array} \\hline\end{array}

Expected NPW = $1,029.75 + 6,971.4 + 8,059.5 -1,269.5-46.80+1,461= $16,205.25

A Continuous Improvement Has Helped a Company to Raise Savings

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A Continuous Improvement Has Helped a Company to Raise Savings

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