Question 2 A consulting engineer has been engaged to advise a town on the best way to proceed with the construction of a 20,000km3 water supply reservoir. Since only 12,000km3 of storage will be required for the noxt 25 years, an alternative to building the full capacity now is to build the reservoir in two stages. Initially, the reservoir could be built with 12,000km3 of capacity and then, after 25 years, the additional of 8,000km3 of capacity could be added by increasing the height of the reservoir. Estimated costs are as follows: If the interest rate is a6%, which construction plan is preferred? Question 2 A consulting engineer has been engaged to advise a town on the best way to proceed with the construction of a 20,000km3 water supply reservoir. Since only 12,000km3 of storage will be required for the noxt 25 years, an alternative to building the full capacity now is to build the reservoir in two stages. Initially, the reservoir could be built with 12,000km3 of capacity and then, after 25 years, the additional of 8,000km3 of capacity could be added by increasing the height of the reservoir. Estimated costs are as follows: If the interest rate is a6%, which construction plan is preferred