Compare the two designs using equivalent worth per mile

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Reference no: EM131352271

A new highway is to be constructed with two alternative designs. Design A calls for a concrete pavement costing $90 per foot with a 20-year life; two paved ditches costing $3 per foot each; and three box culverts every mile, each costing $9,000 and having a 20-year life. Annual maintenance will cost $1,800 per mile; the culverts must be cleaned every five years at a cost of $450 each per mile. Design B calls for a bituminous pavement costing $45 per foot with a 10-year life, two sodded ditches costing $1.50 per foot each; and three pipe culverts every mile, each costing $2,250 and having a 10-year life. The replacement culverts will cost $2,400 each. Annual maintenance will cost $2,700 per mile; the culverts must be cleaned yearly at a cost of $225 each per mile; and the annual ditch maintenance will cost $1.50 per foot per ditch. Compare the two designs using equivalent worth per mile for a 20-year period. Find the most economical design if the MARR is 6% per year.

Reference no: EM131352271

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