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City 1 wants to encourage an electric vehicle research centre to locate in the city. The centre would be a non-profit organization and therefore would
- City 1 wants to encourage an electric vehicle research centre to locate in the city. The centre would be a non-profit organization and therefore would not pay taxes. Another community has offered to provide a $10 million, 20 year, 5% loan to be repaid in equal annual installments of $802,426. Ordinarily, the research centre would have to pay 8% interest on its financing. Instead of offering low-cost financing, City 1 is thinking of offering free land. How much must the land be worth for the value of City 1's incentive package to be the same as that of the competing city?
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