ECU is planning to construct a new football stadium to hold 50,000 people. The initial cost...

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ECU is planning to construct a new football stadium to hold 50,000 people. The initial cost is $200 million. The university anticipates that this project will bring in 40 million in its first year and thereafter the revenues will increase by 5% per year. Operating costs are expected to cost $15 million per year and increase by 2% annually. Given this information, calculate the EUAW for a 10 year period. The MARR is 14% p.y.c.m. Ignore the salvage value. ECU is planning to construct a new football stadium to hold 50,000 people. The initial cost is $200 million. The university anticipates that this project will bring in 40 million in its first year and thereafter the revenues will increase by 5% per year. Operating costs are expected to cost $15 million per year and increase by 2% annually. Given this information, calculate the EUAW for a 10 year period. The MARR is 14% p.y.c.m. Ignore the salvage value.

Answer rating: 100% (QA)

SOLUTION To calculate the EUAW Equivalent Uniform Annual Worth for the 10year period we can use the following formula EUAW A B x PA where A is the pre... View the full answer