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Your company is environmentally conscious and is considering two heating options for a new research building. What you know about each option is below, and your company will use an annual interest rate (MARR) of 9% for this decision. Which is the lower cost option for the company? Click the icon to view the additional information about the options. Click the icon to view the interest and annuity table for discrete compounding when the MARR is 3% per year. Click the icon to view the interest and annuity table for discrete compounding when the MARR is 9% per year. The PW of the Gas Heating Option is $. (Round to the nearest dollar.) C

More Info I Gas Heating Option: The initial equipment and installment of the natural gas system would cost $210,000 right now. The maintenance costs of the equipment are expected to be $1,000 per year, starting next year, for each of the next 20 years. The energy cost is expected to be $4,000 starting next year and is expected to rise by 3% per year for each of the next 20 years due to the price of natural gas increasing. Geothermal Heating Option: Because of green energy incentives provided by the government, the geothermal equipment and installation are expected to cost only $185,000 right now, which is cheaper than the gas lines. There would be no energy cost with geothermal, but because this is a relatively newer technology the maintenance is expected to be $12,000 per year, staring next year, for each of the next 20 years.

N 1 2 3 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Single Payment Compound Present Amount Factor To Find F Given P F/P To Find P Given F P/F 1.0300 0.9709 1.0609 0.9426 1.0927 0.9151 1.1255 0.8885 0.8626 1.1593 1.1941 1.2299 1.2668 1.3048 1.3439 1.3842 1.4258 1.4685 1.5126 1.5580 1.6047 1.6528 1.7024 Worth Factor 1.7535 1.8061 0.8375 0.8131 0.7894 0.7664 0.7441 0.7224 0.7014 0.6810 0.6611 0.6419 0.6232 0.6050 0.5874 0.5703 0.5537 Discrete Compounding; i = 3% Uniform Series Compound Amount Factor To Find F Given A F/A 1.0000 2.0300 3.0909 4.1836 5.3091 6.4684 Present Worth Factor 7.6625 8.8923 10.1591 11.4639 12.8078 14.1920 To Find P Given A P/A 0.9709 1.9135 2.8286 3.7171 4.5797 5.4172 6.2303 7.0197 7.7861 8.5302 9.2526 0.0781 9.9540 0.0705 15.6178 10.6350 0.0640 17.0863 11.2961 0.0585 18.5989 11.9379 0.0638 0.0496 13.1661 0.0460 13.7535 0.0427 0.0398 0.0372 20.1569 12.5611 21.7616 23.4144 Sinking Fund Factor 25.1169 14.3238 26.8704 14.8775 To Find A Given F A/F 1.0000 0.4926 0.3235 0.2390 0.1884 0.1546 0.1305 0.1125 0.0984 0.0872 Capital Recovery Factor To Find A Given P A/P 1.0300 0.5226 0.3535 0.2690 0.2184 0.1846 0.1605 0.1425 0.1284 0.1172 0.1081 0.1005 0.0940 0.0885 0.0838 0.0796 0.0760 0.0727 0.0698 0.0672 Uniform Gradient Gradient Gradient Present Uniform Worth Factor To Find P Given G P/G 0.0000 0.9426 2.7729 5.4383 8.8888 13.0762 17.9547 23.4806 29.6119 36.3068 43.5330 51.2482 59.4196 68.0141 77.0002 86.3477 96.0280 106.0137 116.2788 126.7987 Series Factor To Find A Given G A/G 0.0000 0.4926 0.9803 1.4631 1.9409 2.4138 2.8819 3.3450 3.8032 4.2565 4.7049 5.1485 5.5872 6.0210 6.4500 6.8742 7.2936 7.7081 8.1179 8.5229

N 1 2 3 4 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Single Payment Compound Present Worth Amount Factor Factor To Find F Given P F/P 1.0900 1.1881 1.2950 1.4116 1.5386 1.6771 1.8280 1.9926 2.1719 2.3674 2.5804 2.8127 To Find P Given F P/F 0.9174 0.8417 0.7722 0.7084 0.6499 0.5963 0.5470 0.5019 0.4604 0.4224 0.3875 0.3555 3.0658 3.3417 3.6425 3.9703 4.3276 4.7171 0.2120 0.3262 0.2992 0.2745 0.2519 0.2311 5.1417 0.1945 5.6044 0.1784 Discrete Compounding; i = 9% Uniform Series Compound Amount Factor To Find F Given A F/A 1.0000 2.0900 3.2781 4.5731 Present Sinking Worth Factor To Find P Given A P/A 46.0185 51.1601 0.9174 1.7591 2.5313 3.2397 1.0000 0.4785 0.3051 0.2187 5.9847 3.8897 0.1671 7.5233 4.4859 0.1329 9.2004 5.0330 0.1087 11.0285 5.5348 0.0907 13.0210 15.1929 17.5603 20.1407 22.9534 26.0192 29.3609 33.0034 Fund Factor 6.8052 7.1607 To Find A Given F A/F 5.9952 0.0768 6.4177 36.9737 41.3013 8.7556 0.1987 0.1807 0.1668 0.0658 0.1558 7.4869 0.0436 7.7862 0.0384 8.0607 0.0341 Capital Recovery Factor To Find A Given P A/P 1.0900 0.5685 0.3951 0.3087 0.2571 0.2229 0.0669 0.1469 0.0497 0.1397 8.3126 0.0303 8.5436 0.0270 0.1336 0.1284 0.1241 0.1203 0.1170 0.0242 0.1142 8.9501 0.0217 0.1117 9.1285 0.0195 0.1095 Uniform Gradient Gradient Gradient Present Uniform Worth Series Factor Factor To Find P Given G P/G 0.0000 0.8417 2.3860 4.5113 7.1110 10.0924 13.3746 16.8877 20.5711 24.3728 28.2481 32.1590 36.0731 39.9633 43.8069 47.5849 51.2821 54.8860 58.3868 61.7770 To Find A Given G A/G 0.0000 0.4785 0.9426 1.3925 1.8282 2.2498 2.6574 3.0512 3.4312 3.7978 4.1510 4.4910 4.8182 5.1326 5.4346 5.7245 6.0024 6.2687 6.5236 6.7674