J. The maintenance cost for an investment is $2,000 per year for the first 10 years and $1,000 per year thereafter. The investment has infinite life. With a 10% interest rate, what is the present worth of the annual disbursements? Ans: $16,144.60 6. A homeowner is attempting to determine which of three point-of-use (POU) devices to purchase to treat the cold water at the sink. Research revealed the following information: Life Unit Capital O&M Cost Cost ($) ($/yr) POU Device # 1 1 000- 625 POU Device # 2 950550 POU Device #3 11010582 Expectancy (yo) 15 5 10 If the homeowner does nothing, she can invest her money in a 4.5%/year savings account. In making her determination, she believes that inflation will be 3%/year. (a) If she were to capitalize her costs for a 30-year life, what unit should she choose? Ans: #3 (b) How sensitive is her decision to the inflation rate? - 200 Ma for Sir 1077x loge Cost - love 150w 1.500Non. ors operunt J. The maintenance cost for an investment is $2,000 per year for the first 10 years and $1,000 per year thereafter. The investment has infinite life. With a 10% interest rate, what is the present worth of the annual disbursements? Ans: $16,144.60 6. A homeowner is attempting to determine which of three point-of-use (POU) devices to purchase to treat the cold water at the sink. Research revealed the following information: Life Unit Capital O&M Cost Cost ($) ($/yr) POU Device # 1 1 000- 625 POU Device # 2 950550 POU Device #3 11010582 Expectancy (yo) 15 5 10 If the homeowner does nothing, she can invest her money in a 4.5%/year savings account. In making her determination, she believes that inflation will be 3%/year. (a) If she were to capitalize her costs for a 30-year life, what unit should she choose? Ans: #3 (b) How sensitive is her decision to the inflation rate? - 200 Ma for Sir 1077x loge Cost - love 150w 1.500Non. ors operunt