Cost of money-determine the eac

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A small town's sewer system costs $1M installed. With proper maintenance, it should last indie- nightly. Twenty percent of the cost will be for the pumping system, which must be replaced every 20 years. Sixty percent of the cost will be for the tiles and pipes, which will be replaced every 30 years. Annual maintenance costs are estimated to be $3000 per year. Right-of-way and earthworks account for the rest of the cost. If the town uses 12% as its cost of money, determine the EAC. (Answer: $128.3K)

Reference no: EM131807032

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