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Present worth and annualized cost problem A utility in a foreign country (see the interest rate!) is considering four different transmission routes to facilitate the
Present worth and annualized cost problem
A utility in a foreign country (see the interest rate!) is considering four different transmission routes to facilitate the addition of a new load. Listed below are the estimated costs associated with each of the different transmission routes. Assuming the lifetime of the new transmission line is 25 years and the real interest rate is 8%, which route is the most economical? a) Find the best alternative using present worth. b) Find the best alternative using annualized (levelized) cost. c) Explain why the best alternative found in parts (a) and (b) is the same
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