v=2000

Question # 2: - [3 points] Riyadh Municipality is considering increasing the capacity of the current sewerage water treatment plant at the outskirts of Riyadh. The capital project investment is {SR 2M +V}. The incremental annual benefits and costs are SR 440,000 and SR 160,000. The salvage value for the project is {SR 80,000+V}. The project will last for 25 years and discount rate is 6%. Calculate the benefit-cost ratio for this project and discuss its acceptability? Note that V is the last digit of your University ID and its in 1000. For example, if student ID is 3, the value of V is SR3000