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I need help understanding how the CW of Plan B is calculated. Estimates for a proposed small public facility are as follows: Plan A has
I need help understanding how the CW of Plan B is calculated.
Estimates for a proposed small public facility are as follows: Plan A has a first cost of $45,000, a life of 25 years, a $4,000 market value, and annual maintenance expenses of $1,000. Plan B has a first cost of $95,000, a life of 50 years, no market value, and annual maintenance expenses of $7,000 for the first 15 years and $950 per year for years 16 through 50. Assuming interest at 9% per year, compare the two plans, using the CW method. Click the icon to view the interest and annuity table for discrete compounding when i = 9% per year. The CW of Plan A is $ -61500 . (Round to the nearest hundreds.) The CW of Plan B is $ -164,000. (Round to the nearest hundreds.)Step by Step Solution
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