COSTS OF $ $10,000 per year. It will also have major repairs Costing $80,000 that occur at years 10, 20, 30 and 40. It will have additional repairs at the end of year 25 costing $250,000. Determine the the equivalent uniform annual cost if the rate of interest

COSTS OF $ $10,000 per year. It will also have major repairs Costing $80,000 that occur at years 10, 20, 30 and 40. It will have additional repairs at the end of year 25 costing $250,000. Determine the the equivalent uniform annual cost if the rate of interest

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

A new office building has been
constructed at a cost of $3,000,000. It is
estimated to have a life of 50 years with a
value at that time of $200,000. It will
have maintenance costs of $10,000 per
year. It will also have major repairs
costing $80,000 that occur at years 10,
20, 30 and 40. It will have additional
repairs at the end of year 25 costing
$250,000. Determine the equivalent
uniform annual cost if the rate of interest
of the firm is 7%

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