A town$$s recreation department is trying to decide how to use a piece of land. One option is to

put up basketball courts with an expected life of $8$ years. Another is to install a swimming pool

with an expected life of $24$ years. The basketball courts would cost $$180,000$ to construct and

yield net benefits of $$40,000$ at the end of each of the eight years. The swimming pool would

cost $$2\mathrm{.}25$ million to construct and yield net benefits of $$170,000$ at the end of each of the $24$

years. Each project is assumed to have zero salvage value at the end of its life. Using a real

discount rate of $5$ percent, which project offers larger net benefits?

Hint: Make the lifetimes of each possible project fully comparable and allow for the possibility

that a project could end its life and need to be rebuilt.