A wood post initially costs P 25, 000 with an installation and miscellaneous expenses of P 7, 500 before operation. It is expected to last for twenty years with an annual maintenance of P 2, 750 and a scrap value of P 1, 500. A concrete post can be an alternative with an initial cost and other expenses before operation doubled than that of the first cost of the wood post. However, concrete post does not need annual maintenance and has a scrap value of P 3, 500 before replacement. If the capitalized cost of the concrete post is 15% higher than that of the wood post, approximately how many years will the concrete post lasts? Money is 12% compounded monthly. (Please draw a cash flow diagram).

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Wood Post Concrete Post Initial Cost 25000 50000 Installation and other expenses 7500 15000 Annual M... View the full answer