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%.
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%.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
![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](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F2f41e983-dd33-444c-a567-fe996aa05081%2Fef53318f-71dd-485b-9916-65ab6c91b22f%2Fve22jt_processed.jpeg&w=3840&q=75)
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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