6 4 Example Two Alternatives Are Considered For Covering A Football Field Interest Rate Is 10 Year Assume The Fiel 1 (21.35 KiB) Viewed 35 times
6.4 Example ... Two alternatives are considered for covering a football field, Interest rate is 10%year. Assume the field is to last a "long time". A. The first is to plant natural grass Natural Grass - Replanting will be required each 10 years at a cost of $10,000. Annual cost for maintenance is $5,000. Equipment must be purchased for $50,000, which will be replaced after 5 years with a salvage value of $5,000 B. The second is to install AstroTurf (Artificial Carpet). Cost of Installation: - $150,000, Annual Maintenance = $5,000/year Alternative F = $5,000 F $5,000 10 FTTTTTTTTTT A $5,000 $10,000 s=$50,000 = $50,000+ $10,000
6.4 Example: Artificial Carpet (Surface) • A = P(i) for a perpetual life project • Annual Cost of Installation: •=$150,000 (10) = $15,000/ year • Annual Maintenance = $5,000/year = = Individual Task Alternative A or B............ .?
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