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Wok & Roll is planning to introduce their Rockin’ Chinese cuisine to the Memphis area One of their restaurants is being designed for a strip mall in Germantown For this location

Wok & Roll is planning to introduce their Rockin’ Chinese cuisine to the Memphis area. One of their restaurants is being designed for a strip mall in Germantown. For this location, the heat loss in the winter and heat gain in the summer is anticipated to cost $3,000 at the end of next year. A salesperson from Superfiber Insulation, Inc., has told the design engineers for Wok & Roll that the cost can be reduced by 75% with the installation of $28,000 worth of Superfiber now. Assume that the energy costs will increase by $250 next year and thereafter for a total of fourteen years. Wok & Roll plans to use this location for the next fifteen years. Wok & Roll requires a MARR of 8% per year for all of their locations. Should the engineers recommend the purchase of the Superfiber Insulation? Explain your answer. Include a cash flow diagram with your solution.

Apr 04 2020 View more View Less

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