Two methods of carrying away surface runoff water from a new subdivision are being evaluated. • Method A. Dig a ditch. The first cost would be S60,000, and $25,000 of re-digging and shaping would be required at five-year intervals forever. • Method B. Lay concrete pipe. The first cost would be $150,000, and a replacement would be required at 50-year intervals at a net cost of $180,000 forever Ati- 12%, which method is the better one? Click the icon to view the interest factors for discrete compounding when / 12% per year. The capitalized equivalent worth for method A is S thousand, (Round to the
Two methods of carrying away surface runoff water from a new subdivision are being evaluated. • Method A. Dig a ditch. The first cost would be S60,000, and $25,000 of re-digging and shaping would be required at five-year intervals forever. • Method B. Lay concrete pipe. The first cost would be $150,000, and a replacement would be required at 50-year intervals at a net cost of $180,000 forever Ati- 12%, which method is the better one? Click the icon to view the interest factors for discrete compounding when / 12% per year. The capitalized equivalent worth for method A is S thousand, (Round to the
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
Problem 1E: A firm has the opportunity to invest in a project having an initial outlay of $20,000. Net cash...
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