4. Really Big Center for the Athletic Arts is a for-profit entity co-located with Big State University. Their ATMARR is 9% and they pay taxes at 24%. The CEO of the Really Big Center is considering building a new tennis facility and has two choices:

	Smaller Center	Bigger Center
Initial Cost	$11 million	$27 million
Uniform Annual Benefit	$4 million	$10 million
Estimated Salvage Value	$2 million	$3 million
Depreciation Method	SOYD	SOYD
Life	5 years	5 years

a. Which center is a better choice? Why?

b. Five and a half years later, you are doing a post-mortem analysis of the project and discover that while the Smaller Center had a salvage price of $2 million, the Bigger Center was, in fact, sold for $5 million. How does this change your analysis, if at all?