The construction cost of a hydroelectric power plant is $500000, the maintenance cost (done every 10 years) is $40000, and the annual operating cost is $1000, With this powe plant, 1 million kWh of electricity will be produced annually. Which selling price (per kW of electricity makes the construction of the power plant viable when the interest rate is 20%? If necessary, you can choose more than one options. 11ש
The construction cost of a hydroelectric power plant is $500000, the maintenance cost (done every 10 years) is $40000, and the annual operating cost is $1000, With this powe plant, 1 million kWh of electricity will be produced annually. Which selling price (per kW of electricity makes the construction of the power plant viable when the interest rate is 20%? If necessary, you can choose more than one options. 11ש
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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Pls select the correct option and explain it in 4-5 sentences..
Transcribed Image Text:The construction cost of a hydroelectric power plant is $500000, the maintenance cost
(done every 10 years) is $40000, and the annual operating cost is $1000. With this power
plant, 1 million kWh of electricity will be produced annually. Which selling price (per kWh)
of electricity makes the construction of the power plant viable when the interest rate is
20%?
If necessary, you can choose more than one options.
Oa. $0.11
O b. $0.13
Oc. $0.07
O d. $0.09
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