A 2,000 square foot house in New Jersey costs $1,725 each winter to heat with its existing oil-burning furnace. For an investment of $5,000, a natural gas furnace can be installed, and the winter heating bill is estimated to be $1,000. If the homeowner's MARR is 6% per year, what is the discounted payback period of this proposed investment?
A 2,000 square foot house in New Jersey costs $1,725 each winter to heat with its existing oil-burning furnace. For an investment of $5,000, a natural gas furnace can be installed, and the winter heating bill is estimated to be $1,000. If the homeowner's MARR is 6% per year, what is the discounted payback period of this proposed investment?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Payback Period Method and Benefit-Cost Ratio Method

Transcribed Image Text:3. A 2,000 square foot house in New Jersey costs $1,725 each winter to heat with its existing oil-burning
furnace. For an investment of $5,000, a natural gas furnace can be installed, and the winter heating bill is
estimated to be $1,000. If the homeowner's MARR is 6% per year, what is the discounted payback period
of this proposed investment?
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