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First Cost $80,000 $120,000 Annual property 3,000 5,000 Annual income 11,000 16,000 Life of building, in years. 20 Salvage value If th of 60/ ..hieh ofth 20

First Cost $80,000 $120,000 Annual property 3,000 5,000 Annual income 11,000 16,000 Life of building, in years. 20 Salvage value If th of 60/ ..hieh ofth 20

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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Pls provide cash flow diagram if needed
PROBLEM #4: The owner of a corner lot wants to find a use that will yield a desirable return on his investment. After much study and calculation, the owner decides that the two best alternatives are: Build Gas Stations Build Ice Cream Stand First Cost $80,000 $120,000 Annual property 3,000 5,000 Annual income 11,000 16,000 Life of building, in years. 20 20 Salvage value If the owner wants a Minimum attractive rate of return on his investment of 6%, which of the two alternatives would you recommend?
Transcribed Image Text:PROBLEM #4: The owner of a corner lot wants to find a use that will yield a desirable return on his investment. After much study and calculation, the owner decides that the two best alternatives are: Build Gas Stations Build Ice Cream Stand First Cost $80,000 $120,000 Annual property 3,000 5,000 Annual income 11,000 16,000 Life of building, in years. 20 20 Salvage value If the owner wants a Minimum attractive rate of return on his investment of 6%, which of the two alternatives would you recommend?
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