The City of San Antonio is considering various options for providing water in its 50-year plan, including desalting. One brackish aquifer is expected to yield desalted water that will generate revenue of $4.1 million per year for the first 3 years, after which less production will decrease revenue by 10% per year each year. If the aquifer will be totally depleted in 23 years, what is the present worth of the desalting option revenue at an interest rate of 6% per year? The present worth of the desalting option revenue at an interest rate of 6% per year is determined to be $ [

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
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The City of San Antonio is considering various options for providing water in its 50-year plan, including desalting. One brackish aquifer
is expected to yield desalted water that will generate revenue of $4.1 million per year for the first 3 years, after which less
production will decrease revenue by 10% per year each year. If the aquifer will be totally depleted in 23 years, what is the present
worth of the desalting option revenue at an interest rate of 6% per year?
The present worth of the desalting option revenue at an interest rate of 6% per year is determined to be $
Transcribed Image Text:The City of San Antonio is considering various options for providing water in its 50-year plan, including desalting. One brackish aquifer is expected to yield desalted water that will generate revenue of $4.1 million per year for the first 3 years, after which less production will decrease revenue by 10% per year each year. If the aquifer will be totally depleted in 23 years, what is the present worth of the desalting option revenue at an interest rate of 6% per year? The present worth of the desalting option revenue at an interest rate of 6% per year is determined to be $
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