Annual maintenance costs of a tunnel, which is considered to have an infinite life, are worth £ 500. The average annual interest rate is 5%. Since the capitalized cost is estimated to be £ 15,000, how much can the tunnel's initial investment cost be?

Engineering Fundamentals: An Introduction to Engineering (MindTap Course List)
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ISBN:9781305084766
Author:Saeed Moaveni
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Chapter20: Engineering Economics
Section: Chapter Questions
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Annual maintenance costs of a tunnel, which is considered to have an infinite life, are worth £ 500. The average annual interest rate is 5%. Since the capitalized cost is estimated to be £ 15,000, how much can the tunnel's initial investment cost be?

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