Using the following data and assume a MARR of 6 percent for an infinite project.
To the People To the Government
Benefits, $ 400,000 now and 200,000 per year for forty years First cost, $ 1,200,000 now and 200,000 three years from now
Disbenefits, $ 18,000 per year AOC, $ 50,000 per year
Savings 90,000 five years from now
a. Calculate conventional benefit/cost ratio using annual worth (AW) values.
b. Calculate modified benefit/cost ratio using annual worth (AW) values.