Create a plan for this electric company outlining the number of plants to be built each year and the associated costs. Provide explanations.

A regional electric power company is planning a large investment in nuclear power plants over the next few years. A total of eight nuclear power plants must be built over the next six years because of both increasing demand in the region and the energy crisis, which has forced the closing of certain of their antiquated fossil fuel plants. Suppose that, for a first approximation, we assume that demand for electric power in the region is known with certainty and that we must satisfy the minimum levels of cumulative demand indicated in Table 1. The demand here has been converted into equivalent numbers of nuclear power plants required by the end of each year. Due to the extremely adverse public reaction and subsequent difficulties with the public utilities commission, the power company has decided at least to meet this minimum-demand schedule. The building of nuclear power plants takes approximately one year. In addition to a cost directly associated with the construction of a plant, there is a common cost of $1.5 million incurred when any plants are constructed in any year, independent of the number of plants constructed. This common cost results from contract preparation and certification of the impact statement for the Environmental Protection Agency. In any given year, at most three plants can be constructed. The cost of construction per plant is given in Table 1 for each year in the planning horizon. These costs are currently increasing due to the elimination of an investment tax credit designed to speed investment in nuclear power. However, new technology should be available by 1984, which will tend to bring the costs down, even given the elimination of the investment tax credit.

Table 1: Demand and cost per plant ($ x 1000)

Year	Cumulative demand (in number of plants)	Cost per plant ($ x 1000)
1981	1	5400
1982	2	5600
1983	4	5800
1984	6	5700
1985	7	5500
1986	8	5200

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