A house owner is debating whether she should install drainpipes around her house to protect her house against heavy rains. The heavy rains tend to leak into the basement of the house. In the next three years, the house owner expects 12 heavy rain showers, one approximately every three months. If no drains are installed, the cost of repairing the leaks is expected to be $800 per thunderstorm. Alternatively, a corrugated steel drainpipe could be installed which could prevent the infiltration of water. The installation cost of the pipe would be $1.50 per foot, with a total length of 5,000 ft required. After the three-year period, some of the pipe could be recovered with an estimated value of $3,000. Assuming the rain showers occur at three-month intervals, which alternative should the house owner select, if the interest rate is a nominal 20% per year compounded semiannually. Assume there is interperiod interest. Use the rate of return method of comparison. Use annual equivalent values in your rate of return calculations.