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The initial cost of a bridge that is expected to be in place forever is $70 million. Maintenance can be done at 1, 2, 3,
The initial cost of a bridge that is expected to be in place forever is $70 million. Maintenance can be done at 1, 2, 3, or 4 year intervals, but the longer the interval between servicing, the higher the cost. The costs of servicing are $83000, $91000, $125000, and $183000 for intervals of 1 through 4 years, respectively. Assume interest rate is 8% per year. Calculate the AW of maintenance costs if bridge maintenance is scheduled at 1-year intervals
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