Determine the equal annual costs the department

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Reference no: EM131886313

A state’s transportation department is proposing the construction of a new commuter vehicle bypass tunnel approaching a toll plaza. Preliminary cost data is presented below;

First Cost $800,000,000

Annual O & M Costs $14,000,000

Salvage Value $225,000,000 (recyclables)

Safety Refurbishment $45,000,000 (every 10 years)

Safety Inspection $1,200,000 (every 5 years)

Interest Rate (MARR) 5%

Useful Life 100 years

Determine the equal annual costs (EAC) the department will incur for this proposal. (i.e. , Perform an annual worth analysis)

Reference no: EM131886313

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