Te chief ranger of the state's Department of Natural Resources is considering a new plan for fighting forest fires in the state's forest lands. The current plan uses eight fire control staions, which are scattered throughtout the interior of the state forest. Each station has a four person staff, who annual compensation totals $330,000. Other costs of operating each base amount to $230,000 per year. The equipment at each base has a current salvage value of $250,000. The buildings at these interior stations have no other use. To demolish them would cost $23,000 each.

The chief ranger is considering an alternative plan, which involves four fire control stations located on the perimeter of the state forest. Each station would require a six person staff, with annual compensation costs of $430,000. Other operating costs would be $240,000 per base. Building each perimeter station would costs $330,000. The perimeter bases would need helicopters and other equipment costsing $630,000 per station. Half of the equipment from the interior stations could be used at the perimeter stations. Therefore, only half of the equipment at the interior stations would be sold if the perimeter startions were built.

The state uses a 10% hurdle rate for all capital projects. The chief ranger has decided to use a 10-year time period for the analysis.

1. Use the incremental-costs approach to prepare a net-present-value analysis of the chief ranger's decision between the interios fire-control plan and the perimeter fire control plan. (Round your "discount factors" to 3 deciman places. Negative amounts should be indiceated by a minus sign).

Net present value interior stations/perimenter stations