A project with an infinite life has the following details: Initial cost $6 million Annual operating cost-$100,000 Major maintenance cost = $2 million every 30 years, beginning 30 years from now. Calculate the capitalised cost at 8% interest per annum.
A project with an infinite life has the following details: Initial cost $6 million Annual operating cost-$100,000 Major maintenance cost = $2 million every 30 years, beginning 30 years from now. Calculate the capitalised cost at 8% interest per annum.
Chapter1: Making Economics Decisions
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![A project with an infinite life has the following details:
Initial cost = $6 million
Annual operating cost = $100,000
Major maintenance cost = $2 million every 30 years, beginning 30 years from
now.
Calculate the capitalised cost at 8% interest per annum.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F536e0f1e-0f77-4ba0-b49b-8a1ec637db27%2F5f475bbf-6df0-49e6-86a9-0617689cdaf7%2F0d78t7x_processed.jpeg&w=3840&q=75)
Transcribed Image Text:A project with an infinite life has the following details:
Initial cost = $6 million
Annual operating cost = $100,000
Major maintenance cost = $2 million every 30 years, beginning 30 years from
now.
Calculate the capitalised cost at 8% interest per annum.
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