+1-415-670-9189
info@expertsmind.com
Calculate annualized cost of resurfacing-minor maintenance
Course:- Microeconomics
Reference No.:- EM13700147




Assignment Help
Assignment Help >> Microeconomics

The cost of paving a new multi-use trail is $1.7 million. Minor repairs and up-keep will cost $100,000 per year. Every 10 years the trail will need a major re-surfacing at a cost of $850,000. These costs will continue indefinitely.

a. Calculate the annualized cost (EUAC) of the resurfacing and minor maintenance over the first 10 years of the project’s life if i = 12%. Ignore the initial paving cost.

 

b. Based on the EUAC from part (a) above, calculate the capitalized cost (P) of the project over its infinite life including the initial paving cost. Remember that the initial cost is in present dollars and is part of the capitalized cost of the project.




Put your comment
 
Minimize


Ask Question & Get Answers from Experts
Browse some more (Microeconomics) Materials
What are governments fiscal policy options for moving the economy out of a recession Speculate on which of these fiscal options might be favored by a person who wants to pre
Gorton is HIV positive. He is also has severe allergies. The medication he takes to control the debilitating effects of his allergies causes his nasal membranes to dry out,
Two banks have lent $20million each to a country in an Emerging Market. Bank A has total assets of $220 million and a capital to total assets ratio of 7 percent. Bank B has
Suppose that no communication is possible between the firms; each must choose its R&D strategy independently of the other. What actions will the firms take, and what is the
Demand for a good is given by Qd=500-30P1+20P2+5Y and P1=2, P2=2 and Y=100. Calculate the quantity demanded. Is this a normal good? is good 2 a substitute or complement? Now P
Choosing a professional organization focused on a specific segment of the hospitality industry that you are interested in (American Hotel & Lodging Association, National Res
ECO 561- What will excessive or economic profits induce for a firm in any industry structure? Which factor characterizes the competitive relationship between firms in an oligo
In a one-shot game, if you advertise and your rival advertises, you will each earn $5 million in profits. If neither of you advertise, your rival will make $4 million and yo