The owner of a comer lot wants to find a use that will yield a desirable return

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The owner of a comer lot wants to find a use that will yield a desirable return on his investment. After much study and calculation, the owner decides that the two best alternatives are:

Build Soft Ice Cream Build Gas Station Stand $120,000 First cost $80,000 Annual property taxes 3,000 5,000 11,000 Annual

If the owner wants a minimum attractive rate of return on his investment of 6%, which of the two alternatives would you recommend?

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Engineering Economics

ISBN: 9780195168075

9th Edition

Authors: Ted G. Feller

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Question Posted: Feb 25, 2010 02:24 AM

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The owner of a comer lot wants to find a use that will yield a desirable return

Question:

Build Soft Ice Cream Build Gas Station Stand $120,000 First cost $80,000 Annual property taxes 3,000 5,000 11,000 Annual income 16,000 Life of building, in years 20 20 Salvage value

Step by Step Answer:

Year A Gas Station B Ice Cream Stand B A 0 80000 1200...View the full answer

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