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Three independent projects are available for a secret government agency. The estimated costs associated with each alternative are given below. Use the conventional B-C ratio method to determine which alternative(s), if any, should be selected at an interest rate of 7% per year. Assume a project life of 20 years and a B-C ratio of at least 1 for evaluation

                                  Project A                  Project B                 Project C

Initial cost,$       $1,300,000        $1,200,000                    $1,450,000

Annual benefits, $/year      $490,000                $450,000                      $535,000

Annual disbenefits, $/year $310,000                 $280,000                   $345,000

Business Economics, Economics

  • Category:- Business Economics
  • Reference No.:- M91342429

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