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Consider the following cost proposals for the design and construction of a public art display.     A B FC 1,200,000 1,800,000 AOC 75,000 100,000 Overhaul Cost in Year 10 900,000 125,000 If the discount rate of 7% is used and the useful life is 10 years before refurbishment, what is B/C ratio of the "delta" project and which option should be chosen? Consider the reduced overhaul cost of B in Year 10 as a "benefit" to the public. Group of answer choices A.0.761 and A B.0.508 and A C. 1.21 and B D. 1.09 and B

Consider the following cost proposals for the design and construction of a public art display.     A B FC 1,200,000 1,800,000 AOC 75,000 100,000 Overhaul Cost in Year 10 900,000 125,000 If the discount rate of 7% is used and the useful life is 10 years before refurbishment, what is B/C ratio of the "delta" project and which option should be chosen? Consider the reduced overhaul cost of B in Year 10 as a "benefit" to the public. Group of answer choices A.0.761 and A B.0.508 and A C. 1.21 and B D. 1.09 and B

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Consider the following cost proposals for the design and construction of a public art display.  

  A B
FC 1,200,000 1,800,000
AOC 75,000 100,000
Overhaul Cost in Year 10 900,000 125,000

If the discount rate of 7% is used and the useful life is 10 years before refurbishment, what is B/C ratio of the "delta" project and which option should be chosen? Consider the reduced overhaul cost of B in Year 10 as a "benefit" to the public.

Group of answer choices

A.0.761 and A

B.0.508 and A

C. 1.21 and B

D. 1.09 and B

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