3. The Department of Public Works and Highways (DPWH) awarded two contracts worth a combined Php55M to improve (i.e., deepen) a retention basin and reconstruct the spillway that was severely damaged in a flood 2 years ago. The DPWH said that, because of the weak economy, the bids came in Php48M lower than engineers expected. If the projects are assumed to have a 20-year life, what is the annual worth of the savings at an interest rate of 6% per year? A Php25.83k Php4.18M B C Php1.30M D Php82.83k

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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3. The Department of Public Works and Highways (DPWH) awarded two contracts worth a
combined Php55M to improve (i.e., deepen) a retention basin and reconstruct the spillway
that was severely damaged in a flood 2 years ago. The DPWH said that, because of the weak
economy, the bids came in Php48M lower than engineers expected. If the projects are
assumed to have a 20-year life, what is the annual worth of the savings at an interest rate of
6% per year?
A
Php25.83k
B
Php4.18M
Php1.30M
D
Php82.83k
Transcribed Image Text:3. The Department of Public Works and Highways (DPWH) awarded two contracts worth a combined Php55M to improve (i.e., deepen) a retention basin and reconstruct the spillway that was severely damaged in a flood 2 years ago. The DPWH said that, because of the weak economy, the bids came in Php48M lower than engineers expected. If the projects are assumed to have a 20-year life, what is the annual worth of the savings at an interest rate of 6% per year? A Php25.83k B Php4.18M Php1.30M D Php82.83k
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