The Texas Department of Transportation (TxDOT) is considering two designs for crash barriers along a reconstructed portion
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The Texas Department of Transportation (TxDOT) is considering two designs for crash barriers along a reconstructed portion of 1-10. Design 2B will cost $3 million to install and $135,000 per year to maintain. Design 4R will cost $3.7 million to install and $70,000 per year to maintain. Calculate the rate of return and determine which design is preferred if TxDOT uses a MARR of 6% per year and a 20-year project period.
Minimum Acceptable Rate of Return (MARR), or hurdle rate is the minimum rate of return on a project a manager or company is willing to accept before starting a project, given its risk and the opportunity cost of forgoing other...
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