Question and answers are given all I need is a solutionOur subject is engineering economics and the subject is economic study method 4.) A man owns a corner plot. He must decide which of the several alternatives to select in tryingto obtain a desirable return on his investment. After much study and calculation, he decides thatthe two best alternatives are as given in the following table:BuildBuild softice-cream standFirst cost (Rs.)Annual property taxes (Rs.)Annual income (Rs.)Life of building (years)Salvage value (Rs.)gas station20,00,00080,0008,00,00036,00,0001,50,0009,80,0002020Evaluate the alternatives based on the future worth method at i = 12%.%3D 4. Alternative 1-Build gas stationAlternative 2-Build soft ice-cream standFW = Rs. 3,25,85,440FW = Rs. 2,50,77,560The future worth of alternative 1 is greater than that of alternative 2. Thus, building the gas stationis the best alternative.

Economic methodology is that the study of methodologies in social science, notably the methodology,…

Answered: 4. Alternative 1–Build gas station…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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4. Alternative 1–Build gas station Alternative 2-Build soft ice-cream stand FW = Rs. 3,25,85,440 FW = Rs. 2,50,77,560 The future worth of alternative 1 is greater than that of alternative 2. Thus, building the gas station is the best alternative.