Present worth of the total labor and operating cost

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Reference no: EM132015200

In a water treatment plant, the following costs are expected to change:

labor costs are expected to increase at an annual rate of 6%

operating costs will decrease at an annual rate of 4%.

The labor and operating costs at the start of the first year (n=0) are $2.0 million and 3.2 million respectively. Using a Planning Horizon of 3 years determine the dollar value for each cost category for each year and show the Total Labor and Operating Cost for each year adding the two categories using a spreadsheet table. Using an annual interest rate of 4% determine the Present Worth of the Total Labor and Operating Cost after 3 annual periods (ignore the costs for n=0). Show your solution in a spreadsheet table.

Reference no: EM132015200

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