QUESTION
Assignment 11 need it ASAP
Category: Business
Subject: Finance
Due Date: 08/18/2014
Question Asked: 2014-08-10 02:20:58
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User: fognini
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Assignment 11
A private benefactor has offered to purchase and prepare the property for a new state park and set up a perpetuity to fund the annual maintenance costs to make it easier for people to enjoy the outdoors. The benefactor, an industrialists and ardent environmentalist, has asked for alternatives and an analysis to assist his choice. Alternatives have been suggested and forecasts for acquisition, preparation and annual operating costs in millions of dollars have been estimated and listed below for each alternative. Also shown are the forecasted annual users.
Submit the following on a spreadsheet.
- Provide an analysis for the benefactor.
- Provide the amount of the needed perpetuity to fund maintenance and to cover inflation on the recommended alternative(s) if the fund will earn 6.5% interest and the forecasted rate of inflation is 2%.
|
Site |
Acquisition Cost |
Preparation Cost |
Annual Maintenance Cost |
Forecasted Annual Users |
|
1 |
$1.0 |
$3.2 |
$1.0 |
450,000 |
|
2 |
$2.2 |
$2.3 |
$1.2 |
500,000 |
|
3 |
$1.4 |
$0.8 |
$0.9 |
180,000 |
|
4 |
$0.9 |
$0.7 |
$1.4 |
230,000 |
|
5 |
$2.8 |
$2.1 |
$1.0 |
300,000 |
|
6 |
$2.6 |
$1.4 |
$0.9 |
280,000 |
|
7 |
$1.4 |
$1.6 |
$1.3 |
270,000 |
