Metropolitan Water Utility is planning to upgrade its SCADA system for controlling well pumps, booster pumps, and disinfection equipment so that everything can be controlled from one site. The first phase will reduce labor and travel costs by an estimated $31,000 per year. The second phase will reduce costs by an estimated $20,000 per year. If phase I will occur in years 1 through 3 and phase II in years 4 through 8, what is (a) the present worth of the savings, and (b) the equivalent annual worth for years 1 through 8 of the savings? Use an interest rate of 8% per year. Solve using tabulated factors and a spreadsheet.
Metropolitan Water Utility is planning to upgrade its SCADA system for controlling well pumps, booster pumps, and disinfection equipment so that everything can be controlled from one site. The first phase will reduce labor and travel costs by an estimated $31,000 per year. The second phase will reduce costs by an estimated $20,000 per year. If phase I will occur in years 1 through 3 and phase II in years 4 through 8, what is (a) the present worth of the savings, and (b) the equivalent annual worth for years 1 through 8 of the savings? Use an interest rate of 8% per year. Solve using tabulated factors and a spreadsheet.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Metropolitan Water Utility is planning to upgrade its SCADA system for controlling well pumps, booster pumps, and disinfection equipment so that everything can be controlled from one site. The first phase will reduce labor and travel costs by an estimated $31,000 per year. The second phase will reduce costs by an estimated $20,000 per year. If phase I will occur in years 1 through 3 and phase II in years 4 through 8, what is (a) the present worth of the savings, and (b) the equivalent annual worth for years 1 through 8 of the savings? Use an interest rate of 8% per year. Solve using tabulated factors and a spreadsheet.
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