What is net annual benefit for investment in new lighting

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A school has an old lighting system that costs on average SAR 20,000 a year for lighting the building. The old lighting system has zero salvage value at the end of its life. A new design system has been proposed from lighting consultant who confirms that installing the new system will reduce the lighting bill to SAR 8,000 a year if SAR 50,000 are invested in relighting the buildings. If the new lighting system is installed, maintenance cost of SAR 3,000 per year must be taken into account. The new lighting system has also zero salvage value at the end of its life. The new lighting system is estimated to have a life of 20 years, what is the net annual benefit for this investment in new lighting? Take the MARR to be 12%

Reference no: EM13951746

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