A city government is considering two types of town-dump sanitary systems. Design A requires an initial outlay of $354,000 with annual operating and maintenance costs of $45,000 for the next 16 years; design B calls for an investment of $277,000 with annual operating and maintenance costs of $67,000 peryear for the next 16 years. Fee collections from the residents would again be $90,000 per year. The interest rate is 11%, and no salvage value is associated with either system.Click the icon to view the interest factors for discrete compounding when /= 11% per year.(a) Using the benefit-cost ratio BC(), which system should be selected?The PIA - B is 2.11. (Round to two decimal places.)Which system should be selected? Choose the correct answer below.ODesign BDesign AI(b) If a new design (design C), which requires an initial outlay of $335,500 and annual operating and maintenance costs of $56,000, is proposed, would your answer in part (a) change?The PIA -c is 4.39. (Round to two decimal places.)The PIC-a is- (Round to two decimal places.)More InfoN11121314151617181920Single PaymentCompoundAmountFactor(F/P, I, N)3.15183.49853.88334.31044.78465.31095.89516.54367.26338.0623PresentWorthFactor(P/F, I, N)0.31730.28580.25750.23200.20900.18830.16960.15280.13770.1240PrintCompoundAmountFactor(F/A, I, N)19.561422.713226.211630.094934.405439.189944.500850.395956.939564.2028DoneEqual Payment SeriesSinking PresentFundWorthFactor Factor(A/F, I, N) (P/A, I, N)6.20650.05110.04406.49240.03826.74990.03320.02916.98197.19090.02550.02250.01980.01760.0156- X7.37927.54887.70167.83937.9633

The benefit-cost ratio (BCR), also known as the cost-benefit ratio (CBR), is a financial metric used…

A city government is considering two types of town-dump sanitary systems. Design A requires an initial outlay of $354,000 with annual operating and maintenance costs of $45,000 for the next 16 years: design B calls for an investment of $277,000 with annual operating and maintenance co year for the next 16 years. Fee collections from the residents would again be $90,000 per year. The interest rate is 11%, and no salvage value is associated with either system. Click the icon to view the interest factors t discrete compounding when i 11% per year.

A city government is considering two types of town-dump sanitary systems. Design A requires an initial outlay of $354,000 with annual operating and maintenance costs of $45,000 for the next 16 years: design B calls for an investment of $277,000 with annual operating and maintenance co year for the next 16 years. Fee collections from the residents would again be $90,000 per year. The interest rate is 11%, and no salvage value is associated with either system. Click the icon to view the interest factors t discrete compounding when i 11% per year.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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