Which site is best for an extraction period

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Reference no: EM13186607

The federal government is considering three sites for mineral extraction in the national wildlife preserve. The cash flow ($ million) associated with each site are given below

Initial cost Annual cost Annual benefits Annual dis-benefits

Site A 50 3 20 0.5

Site B 90 4 29 1.5

Site C 200 6 61 2.1

Using the B-C ratio method, which site (if any) is best for an extraction period of 5 years and interest rate of 10% per year?

Reference no: EM13186607

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