Objective:

operational efficieticy

Optionsfor Consideration: Future Worth Method and Present Worvh Methid

Option $1$: Build a New Two$-$Story Permanent Butlding, total $15,000$ square foot, with Wood Frame and Stucco:

Cost per square foot: $$600$

Life expectancy: $80$ vears

Annual operation cost: $$60,000$

Option $2$: Build a New Two$-$Story Modular Building, total $15,000$ square foot, on a Permanent Foundation:

Cost per square foot: $$350$

Life expectancy: $50$ years

Annual operation cost: $$80,000$

Option $3$: Install $30$ New Portable Classrooms on a Wood Foundation:

Cost per building: $$200,000$

Life expectancy: $20$ years

Annual operation cost $($first $5$ years$)$: $$120,000$

Annual operation cost $($after $5$ years$)$: $$140,000$

Option $4$: Modernize Existing Wood and Auto Shops and Add a New Structure, total $15,000$ square foot:

Cost per square foot for modernization: $$400$

Life expectancy: $50$ years

Annual operation cost: $$70,000$

Task $1$: Research

Conduct research providing background information, funding sources, construction timeline, and basis for pursuing the project for the abovementioned options.

Task II: Economic Analysis

erform an economic analysis of the options above using $6\%$ annual interest rate. Your calculations ould include:

Present Worth Method

Annual Worth Method

Future Worth Method

Capitalized Cost $($assume the life cycle can be repeated infinitely with the same cash flow pattern$)$