In: Finance
> Orlando has outgrown it’s Citrus Bowl stadium and has not been invited to host the best of College Football Championship games because of it
> If a public works project (a very long term commitment) was planned in Orlando to construct a new, permanent football stadium,
and it’s initial cost was $900M
> The new stadium yearly maintenance cost was $1M/year for years 1-10, growing to $2M/year thereafter
> The new stadium required repainting every 10 years at a cost of $2.5M
>The new stadium required a new grass surface every 5 years at a cost of $3M, and
>The new stadium had a one time Bond payment cost of $15M in year 30
What is the Present Worth cost of this permanent project if city money is available to be borrowed at 6%/yr CA?
What is the Annual amount/year Orlando will be committed to?
Present Worth cost of this permanent project and Annual amount/year Orlando will be committed to is as follow: