It is proposed to place a cable on existing pole line along the shore of a lake to connect two points on opposite sides. Land Route Submarine Route Length, miles 10 5 First cost of cable per mile P40, 000 P68, 000 Annual maintenance per mile P950 P3, 500 Interest on investment 17% 17% Taxes 3% 3% Net Salvage value per mile P12, 000 P22, 000 Life, years 15 15 Which is more economical using the RORAI method and what is the value of RORAI? A. RORAI = 18.94%, Submarine route is more economical. B. RORAI = 19.56%, Land route is more economical. C. RORAI = 18.35%, Submarine route is more economical. D. RORAI = 8.91%, Land route is more economical. %3D

It is proposed to place a cable on existing pole line along the shore of a lake to connect two points on opposite sides. Land Route Submarine Route Length, miles 10 5 First cost of cable per mile P40, 000 P68, 000 Annual maintenance per mile P950 P3, 500 Interest on investment 17% 17% Taxes 3% 3% Net Salvage value per mile P12, 000 P22, 000 Life, years 15 15 Which is more economical using the RORAI method and what is the value of RORAI? A. RORAI = 18.94%, Submarine route is more economical. B. RORAI = 19.56%, Land route is more economical. C. RORAI = 18.35%, Submarine route is more economical. D. RORAI = 8.91%, Land route is more economical. %3D

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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