Station is economical justified by conventional ratio

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The fire chief of a medium-sized city has estimated that the initial cost of a new fire station will be $4 million. Annual upkeep costs are estimated at S300,000. Benefits to citizens of$550,000 per year and disbenefits of $90,000 per year have also been identifed, use a discount rate of 4% per year to determine if the station is economical justified by (a) the conventional B/c ratio and (b) the B- C difference.

Reference no: EM131387752

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