Question
Project A has a first cost of $1,250,000 and will produce a $40,000 net annual benefit over its 50-year life. Project B costs $1,250,000 and
Project A has a first cost of $1,250,000 and will produce a $40,000 net annual benefit over its 50-year life. Project B costs $1,250,000 and produces an $75,000 net annual benefit over its 50-year life. ODOT uses 3% annual interest to evaluate their project.
Which project should you select?
Why?
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Microeconomics
Authors: Paul Krugman, Robin Wells
5th edition
1319098780, 1319098789, 978-1319098780
