![Jacket](/sites/dl/free/0077098595/title/sgn_ma_sm.jpg) Management Accounting Willie Seal,
University of Essex, UK Ray Garrison,
Brigham Young University, Provo, Utah, USA Eric Noreen,
INSEAD, France
Flexible Budgets, Overhead Analysis and Critiques of Budgeting
Internet Exerciseswww: IE14-37 Investing in Wind Power Besides being an environmentally
appealing alternative to other methods of generating electrical power, wind
turbines can be profitable. The Danish Wind Turbine Manufacturers Association
maintains a web site at www.windpower.org
that allows you to compute the net present value of investments in wind-powered
turbines. 1. Verify the net present value calculation for
the default data that already appear on the screen. 2. Change the real interest rate (i.e., discount
rate0 to 12%. What happens to the net present value of the wind turbine? What
happens to the real rate of return (i.e., the internal rate of return?) 3. Keep the real interest rate set at 12%. How
high would the price per kWh (i.e., kilowatt-hour) for electricity have to be
to make this an attractive investment? |
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