Estimates for a proposed small public facility are as follows: Plan A has a first cost of $45,000, a life of 25 years, a $4,000 market value, and annual maintenance expenses of $1,000. Plan B has a first cost of $95,000, a life of 50 years, no market value, and annual maintenance expenses of $7,000 for the first 15 years and $950 per year for years 16 through 50. Assuming interest at 9% per year, compare the two plans, using the CW method. Click the icon to view the interest and annuity table for discrete compounding when i = 9% per year. The CW of Plan A is $-61500. (Round to the nearest hundreds.) The CW of Plan B is $-164,000. (Round to the nearest hundreds.)
Estimates for a proposed small public facility are as follows: Plan A has a first cost of $45,000, a life of 25 years, a $4,000 market value, and annual maintenance expenses of $1,000. Plan B has a first cost of $95,000, a life of 50 years, no market value, and annual maintenance expenses of $7,000 for the first 15 years and $950 per year for years 16 through 50. Assuming interest at 9% per year, compare the two plans, using the CW method. Click the icon to view the interest and annuity table for discrete compounding when i = 9% per year. The CW of Plan A is $-61500. (Round to the nearest hundreds.) The CW of Plan B is $-164,000. (Round to the nearest hundreds.)
Chapter1: Making Economics Decisions
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Transcribed Image Text:Estimates for a proposed small public facility are as follows: Plan A has a first cost of $45,000, a life of 25 years, a
$4,000 market value, and annual maintenance expenses of $1,000. Plan B has a first cost of $95,000, a life of 50 years, no
market value, and annual maintenance expenses of $7,000 for the first 15 years and $950 per year for years 16 through
50. Assuming interest at 9% per year, compare the two plans, using the CW method.
a Click the icon to view the interest and annuity table for discrete compounding when i 9% per year.
The CW of Plan A is $
61500. (Round to the nearest hundreds.)
The CW of Plan B is $-164,000'. (Round to the nearest hundreds.)
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