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28 July, 10:50

The benefits associated with a nuclear power plant cooling water filtration project located on the Ohio River are $10,000 per year forever starting in year 1. The costs are $50,000 in year 0 and $50,000 in year 2. What is the B/C ratio at i

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  1. 28 July, 11:15
    0
    1.1

    Explanation:

    B/C ratio at i=10% per year?

    Benefit = A/i%

    Cost = initial cost - present worth

    B/C = benefit / cost

    = [10,000/0.1]/[50,000 + 50000] (p/f, 10%,2)

    = [100000/50000 + 50000 (0.8264) ]

    = 1.1
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