The Texas Department of Transportation (TxDOT) is considering two designs for crash barriers along a reconstructed portion of 1-10. Design 2B will cost $3 million to install and $130,000 per year to maintain. Design 4R will cost $3.7 million to install and $55,000 per year to maintain. Determine which design should be selected based on a rate of return analysis if TxDOT uses a MARR of 6% per year and a 20-year project period. The rate of return is

ENGR.ECONOMIC ANALYSIS
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ISBN:9780190931919
Author:NEWNAN
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Chapter1: Making Economics Decisions
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The Texas Department of Transportation (TxDOT) is considering two designs for crash barriers
along a reconstructed portion of 1-10. Design 2B will cost $3 million to install and $130,000
per year to maintain. Design 4R will cost $3.7 million to install and $55,000 per year to
maintain. Determine which design should be selected based on a rate of return analysis if
TxDOT uses a MARR of 6% per year and a 20-year project period.
The rate of return is
Transcribed Image Text:The Texas Department of Transportation (TxDOT) is considering two designs for crash barriers along a reconstructed portion of 1-10. Design 2B will cost $3 million to install and $130,000 per year to maintain. Design 4R will cost $3.7 million to install and $55,000 per year to maintain. Determine which design should be selected based on a rate of return analysis if TxDOT uses a MARR of 6% per year and a 20-year project period. The rate of return is
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