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 4.00 years, after which less production will decrease revenue by 10% per year each year. If the aquifer will be totally depleted in 20.00 years, what is the present worth of the desalting option revenue at an interest rate of 9.00% per year? (Round the final answer to three decimal places.) The present worth of the desalting option revenue at an interest rate of 9.000% per year is determined to be $ 16668837

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Chapter17: Long-term Investment Analysis
Section: Chapter Questions
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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 4.00 years, after which less
production will decrease revenue by 10% per year each year. If the aquifer will be totally
depleted in 20.00 years, what is the present worth of the desalting option revenue at an
interest rate of 9.00% per year? (Round the final answer to three decimal places.)
The present worth of the desalting option revenue at an interest rate of 9.000% per year is
determined to be $ 16668837
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 4.00 years, after which less production will decrease revenue by 10% per year each year. If the aquifer will be totally depleted in 20.00 years, what is the present worth of the desalting option revenue at an interest rate of 9.00% per year? (Round the final answer to three decimal places.) The present worth of the desalting option revenue at an interest rate of 9.000% per year is determined to be $ 16668837
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