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The City of San Antonio is considering various options for providing water in its 50year plan,...

The City of San Antonio is considering various options for providing water in its 50year plan, including desalting. One brackish aquifer is expected to yield desalted water that will generate revenue of $4.1 million per year for the first 4 years, after which less production will decrease revenue by 10% per year each year. If the aquifer will be totally depleted in 23 years, what is the present worth of the desalting option revenue at an interest rate of 8% per year?

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Expert Solution

Therefore the Present Worth = $28,176,187

If there is any doubt please ask in comments

Rahul Sunny answered 7 months ago
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