A proposed building may be roofed in either composition roofing (C) or galvanized steel sheet (S). The composition roof costs $56,000 and is replaced every 5 years (assume at the same cost). The steel roof costs $68,000 but the useful life is very long. Neither roof has any salvage value, nor is maintenance needed. If the MARR is 10%, what minimum life must the steel roof have to make it the better alternative? (Report to the nearest whole year; don't bother interpolating.)
A proposed building may be roofed in either composition roofing (C) or galvanized steel sheet (S). The composition roof costs $56,000 and is replaced every 5 years (assume at the same cost). The steel roof costs $68,000 but the useful life is very long. Neither roof has any salvage value, nor is maintenance needed. If the MARR is 10%, what minimum life must the steel roof have to make it the better alternative? (Report to the nearest whole year; don't bother interpolating.)
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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A proposed building may be roofed in either composition roofing (C) or galvanized steel sheet (S). The composition roof costs $56,000 and is replaced every 5 years (assume at the same cost). The steel roof costs $68,000 but the useful life is very long. Neither roof has any salvage value, nor is maintenance needed. If the MARR is 10%, what minimum life must the steel roof have to make it the better alternative? (Report to the nearest whole year; don't bother interpolating.)
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