Calculate the present worth for each estimated value

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Reference no: EM131371994

A new engineer is evaluating whether to use a high-voltage transmission line. It will cost $250,000 more initially, but it will reduce transmission losses. The optimistic, most likely, and pessimistic projections for annual savings are 25,000, 20,000, and 13,000. The interest rate is 6%, and the transmission line should have a life of 30 years.

(a) Calculate the present worth for each estimated value

(b) Use the range of estimates to compute the mean annual savings

Reference no: EM131371994

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