A flood control project A will have a first cost of $1.4 million with an annual...
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A flood control project A will have a first cost of $1.4 million with an annual maintenance cost of $40,000 and a 10 year life. Reduced flood damage is expected to amount to $175,000 per year. Lost income to farmers is estimated to be $25,000 per year. A second project B has a first cost of $160,000 with an annual maintenance cost of $30,000 and a 15 year life. Reduced flood damage is expected to amount to $950,000 per year. Lost income to farmers is estimated to be $50,000 per year. At an interest rate of 6% per year, and using the modified B/C method, which of the project(s) should be undertaken (if any)? The projects are independent. A flood control project A will have a first cost of $1.4 million with an annual maintenance cost of $40,000 and a 10 year life. Reduced flood damage is expected to amount to $175,000 per year. Lost income to farmers is estimated to be $25,000 per year. A second project B has a first cost of $160,000 with an annual maintenance cost of $30,000 and a 15 year life. Reduced flood damage is expected to amount to $950,000 per year. Lost income to farmers is estimated to be $50,000 per year. At an interest rate of 6% per year, and using the modified B/C method, which of the project(s) should be undertaken (if any)? The projects are independent.
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Related Book For
Holt McDougal Larson Geometry
ISBN: 9780547315171
1st Edition
Authors: Ron Larson, Laurie Boswell, Timothy D. Kanold, Lee Stiff
Posted Date:
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