The EUAC of the inn.
Answer to Problem 58P
The EUAC of the inn is
Explanation of Solution
Given:
Initial cost of the land is
Annual operation and maintenance cost is
Painting cost is
Exterior painting cost is
Furniture replacement cost is
Parking and Paving cost is
Net demolition cost is
MARR is
Calculation:
Draw the cash flow diagram to compute the EUAC.
Figure (1)
Write the expression to calculate the present worth of the cash flow shown in Figure (1).
Here, the present worth is
Substitute
Write the expression to calculate the EUAC.
Here, the equivalent uniform annual cost is
Substitute
Conclusion:
Thus, the EUAC of the inn is
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