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please solve with paper, thanks There are plans to build new connection roads to an antique site to increase tourism into the area. The site
please solve with paper, thanks
There are plans to build new connection roads to an antique site to increase tourism into the area. The site can be reached by extending railroads, or by building a temporary bridge. The new railroad will have an initial cost of $40 million and must be resurfaced every 5 years at a cost of $1 million. The annual inspection and operating costs are estimated to $60,000. The first possible temporary bridge will last 20 years and have an initial cost of $8 million, annual operating costs of $120,000 and a salvage value of $1 million. The second possible temporary bridge will last 15 years and have an initial cost of $6 million, annual operating costs of $150,000 and a salvage value of $1.2 million. It also needs to be resurfaced every 3 years for $200,000. Compare the three alternatives using annual worth analysis and an interest rate of 4% per year. a) Which one is the best alternative? b) For the other two alternatives to be economically equivalent, what should their first Step by Step Solution
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