5-16. Two alternative water supply systems are being considered for a small community. Compare the...
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5-16. Two alternative water supply systems are being considered for a small community. Compare the present worths of the costs of 20 years' service using an i of 9%. System A requires an initial investment of $85,000 with the replacement of certain elements at the end of 10 years at an expected cost of $24,000. Annual operation and maintenance costs will be $8,000 the first year and are expected to increase by $500 each year thereafter. System B requires an initial investment of $105,000 and is expected to last the full 20 years without major replacements. Annual disbursements are expected to be $6,000 the first year and to increase by $350 each year thereafter. There will be no
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