b) An investment company is considering building a new production plant for 25 production lines for renting. Because of the long-term growth potential of the plant, it is felt that the company could average 90% of the full use of the plant each year. If the following items are reasonably accurate estimates, what is the minimum monthly rent that should be charged per production line if a 10% MARR per year is desired? Use the annual worth (AW) method. Assume that annual upkeep is directly proportional to 90% use of the plant. Items Money ($) Land cost Plant building cost Study period, n Upkeep expense for unit production line per month Property taxes and insurance per year 50,000 225,000 20 years 35 10% of the fowl initial investment

b) An investment company is considering building a new production plant for 25 94/3 production lines for renting. Because of the long-term growth potential of the plant, it is felt that the company could average 90% of the full use of the plant each year. If the following items are reasonably accurate estimates, what is the minimum monthly rent that should be charged per production line if a 10% MARR per year is desired? Use the annual worth (AW) method. Assume that annual upkeep is directly proportional to 90% use of the plant. Items Money ($) Land cost 50,000 Plant building cost 225,000 Study period, n 20 years Upkeep expense for unit production line per month Property taxes and insurance per year 10% of the total initial investment 35