i% = 18

PA(X) = needed

Pc(X) = needed

PW(X) = needed

PA(Y) = needed

Ps(Y) = needed

PW(Y) = needed

delta(C+O) = needed

deltaB = needed

deltaB/C = needed

Case 1: You are the engineer who is responsible about renovation of your company headquarters. Two plans were proposed. Plan X involves remodeling the existing headquarters at a cost of $ 2.25 million. The expected useful life of the existing headquarters after remodeling is 25 years and the annual maintenance and operating (M&0) cost would be $126,000 per year. Plan Y involves building a new headquarters and selling the existing one with a net price of $750,000 three years from now. A total of 5 thousands square meter is required for the new headquarters. The cost of the land is estimated to be $366,000 per thousand square meters. The size of the building is 1 thousand square meter and the building will be 10 stories. The construction cost of the building is $150 per square meter and requires 5 years assuming 2 stories are built per year. In addition, the architect and contractor fees are expected to be $420,000. The expected useful life of the new headquarters is 50 years and the annual maintenance and operating (M&O) cost would be $116,000 per year. If the interest rate is i % per year, evaluate which plan is better on the basis of: (a) the present worth analysis, and (b) the conventional B/C analysis Case 1: You are the engineer who is responsible about renovation of your company headquarters. Two plans were proposed. Plan X involves remodeling the existing headquarters at a cost of $ 2.25 million. The expected useful life of the existing headquarters after remodeling is 25 years and the annual maintenance and operating (M&0) cost would be $126,000 per year. Plan Y involves building a new headquarters and selling the existing one with a net price of $750,000 three years from now. A total of 5 thousands square meter is required for the new headquarters. The cost of the land is estimated to be $366,000 per thousand square meters. The size of the building is 1 thousand square meter and the building will be 10 stories. The construction cost of the building is $150 per square meter and requires 5 years assuming 2 stories are built per year. In addition, the architect and contractor fees are expected to be $420,000. The expected useful life of the new headquarters is 50 years and the annual maintenance and operating (M&O) cost would be $116,000 per year. If the interest rate is i % per year, evaluate which plan is better on the basis of: (a) the present worth analysis, and (b) the conventional B/C analysis