2. A wooden pole- untreated, will last for 10 years under a certain soil condition, costs P1.2M. If a treated pole will have a useful life double that of the untreated pole, what is the maximum justifiable amount that can be paid for the treated pole, if the maximum amount of ROI is 12%. Consider the annual taxes and insurance to be 1% of the first cost.

2. A wooden pole- untreated, will last for 10 years under a certain soil condition, costs P1.2M. If a treated pole will have a useful life double that of the untreated pole, what is the maximum justifiable amount that can be paid for the treated pole, if the maximum amount of ROI is 12%. Consider the annual taxes and insurance to be 1% of the first cost.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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