Homework answers / question archive / Compare the lifecycle cost of passenger vehicles operating on different fuels Use MS Excel to develop a calculator to conduct the analysis Understand the different factors that impact the lifecycle cost of driving Description In this assignment, students will develop their own tool using MS Excel to calculate the Lifecycle Cost Of Driving (LCOD) a passenger vehicle

Compare the lifecycle cost of passenger vehicles operating on different fuels Use MS Excel to develop a calculator to conduct the analysis Understand the different factors that impact the lifecycle cost of driving Description In this assignment, students will develop their own tool using MS Excel to calculate the Lifecycle Cost Of Driving (LCOD) a passenger vehicle

Economics

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• Compare the lifecycle cost of passenger vehicles operating on different fuels
• Use MS Excel to develop a calculator to conduct the analysis
• Understand the different factors that impact the lifecycle cost of driving

Description

In this assignment, students will develop their own tool using MS Excel to calculate the Lifecycle Cost Of Driving (LCOD) a passenger vehicle. The developed tool will include various factors such as fuel cost upfront cost, maintenance cost, and government rebates. Students will then conduct a sensitivity analysis to understand the impact of all factors on the LCOD and explain their analysis and recommendations on how to improve the LCOD for electric vehicles.

Instructions

Use the MS Excel template provided to compare the Lifecycle Cost Of Driving for two passenger vehicles; one gasoline and the other electric. The two vehicles are Nissan Altima and Nissan Leaf.

1. Conduct the necessary research to find all the inputs needed to fill the LCOD template provided. Show your references in the summary report.
2. Use your inputs to calculate the LCOD for each vehicle using the Excel template provided.
3. Plot your comparison on a “stacked bar chart” showing the capital and operating components for each vehicle and also comparing the NPV,
4. Conduct a sensitivity analysis to assess the impact on LCOD for each of the following changes and present your answers in a table making one change at a time:
   • Vehicles were driven 10,000 km per year.
   • Vehicles were driven 40,000 km per year.
   • Incentive amounts from government were doubled.
   • Electricity cost increased by 50%
   • Fuel prices increased by 50%
5. Use MS Word to write a summary report of the main findings and discuss:
   • Initial LCOD results
   • Sensitivity analysis and impact on LCOD,
   • Policy instruments that would improve the financial case for electric vehicles,
   • What would be your recommendations from a financial standpoint to your friend who wants to buy a vehicle and is considering an electric vehicle,
   • Your summary should include all your inputs and associated reference.
6. Submit your MS Excel showing entered inputs and plots.

Initial Assumptions 

• Vehicles useful life = 10 years
• Kilometers driven per year = 25,000 km
• Discount rate = 5%

Deliverables

• MS Word summary report.
• MS Excel spreadsheet.