Determine which route should be selected by the car

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Two different routes are under consideration for a new interstate highway:

Length of Highway First Cost Annual Upkeep Cost
The "long route" 22 miles $21 millions $140,000

Transmontain 10 miles $45 millions $165,000
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For either route, the volume of traffic will be 400,000 cars per year. These cars are assumed to operate at $0.25 per mile. Assuming a 40-year life for each road and an interest rate of 10%, determine which route should be selected.

Reference no: EM13239906

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