Cost estimates for a porposed public facility are being evaluated. Initial construction cost is

anticipated to be $120,000 and annual maintenance expenses are expected to be $6500 for

the first 20 years and $2000 for every year thereafter. The facility is to be used and maintained

for an indefinite period of time. Using an interest rate of 10% per year, the capitalized cost of

this facility is most nearly?

a. $180,000

b. $190,000

c. $200,000

d. $270,000