Calculate b/c ratio associated with purchasing the equipment

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Reference no: EM131004416

A water utility is trying to decide between installing equipment for conducting analyses for en- docrine disrupting substances, pharmaceuticals, and personal-care products or sending the samples to a private contract lab. The equipment to conduct the tests will cost $595,000 and will have a 5-year life. In addition, a full-time chemist will have to be hired at a cost of $56,000 per year. Expendable supplies (gases, chemicals, glassware, etc.) will cost $19,000 per year. The utility anticipates 140 samples per year. If the analyses are sent to an out- side lab, the cost per sample will average $1250. If the utility uses an interest rate of 6% per year, calculate the B/C ratio associated with purchasing the equipment.

Reference no: EM131004416

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