Determining the benefit-cost analysis

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Reference no: EM131809346

A government agency is planning a new office building close to its current headquarters. Four proposed sites are to be evaluated. Any of these sites will save the agency $700,000 per year, since two of its current satellite offices will no longer need to be rented. The agency uses a 6% interest rate and assumes that the building and its benefits will last for 40 years. Based on a benefit-cost analysis what should the agency do?

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Contributed by Hamed Kashani, Saeid Sadri, and Baabak Ashuri, Georgia Institute of Technology.

Reference no: EM131809346

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