es the purchase of a parcel of land on which ne expansion plan of business uild a structure, which will give the business an additional annual revenue of P2,000,00 vill incur an additional annual maintenance cost of 200,000. The costs are: land, P3,000 nd building P9,500,000. If the building will only be good for 20 years. Find the benefit-c atio of the expansion plan. Use i=8%.

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
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The expansion plan of business firm requires the purchase of a parcel of land on which to
build a structure, which will give the business an additional annual revenue of P2,000,000 but
will incur an additional annual maintenance cost of 200,000. The costs are: land, P3,000,000
and building P9,500,000. If the building will only be good for 20 years. Find the benefit-cost
ratio of the expansion plan. Use i=8%.
Select the correct response:
1.3576
1.3756
1.7536
1.7356
Transcribed Image Text:The expansion plan of business firm requires the purchase of a parcel of land on which to build a structure, which will give the business an additional annual revenue of P2,000,000 but will incur an additional annual maintenance cost of 200,000. The costs are: land, P3,000,000 and building P9,500,000. If the building will only be good for 20 years. Find the benefit-cost ratio of the expansion plan. Use i=8%. Select the correct response: 1.3576 1.3756 1.7536 1.7356
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