Question
A remotely located air sampling station can be powered by solar cells or by running anelectric line to the site and using conventional power. Solar
A remotely located air sampling station can be powered by solar cells or by running anelectric line to the site and using conventional power. Solar cells will cost $20,000toinstall and will have a useful life of 4 years with no salvage value. Annual costs forinspection, cleaning, etc.are expected to be $1,200. A new power line will cost $10,000 toinstall, with power costs expected to be $900per year. Since the air sampling project willend in 4 years, the salvage value of the line is considered to be zero. At an interest rate of8% per year, which alternative should be selected on the basis of a future worth analysis?
The future worth of solar cells is $and that of electric line is $.
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