Question
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El Paso Water Utilities (EPWU) purchases surface water for treatment and distribution to EPWU customers from...
El Paso Water Utilities (EPWU) purchases surface water for treatment and distribution to EPWU customers from El Paso County Water Improvement District during the irrigation season. A new contract between the two entities resulted in a reduction in future price increases in the cost of the water from 10% per year to 5% per year for the next 20 years. If the cost of water next year (which is year 1 of the new contract) will be $530 per acre-ft. using an interest rate of 10% per year,
a) Determine the difference between present worth (in $/acre-ft) of the old and the new contracts (solve using both formula and spreadsheet functions).
b) If new contract also needs a future payment of $2,000 at year 20, what is the equivalent annual worth of the new contract? (solve using both table values and spreadsheet functions)
Solutions
jeff jeffy answered 1 year agoRelated Solutions
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Water will be pumped from a reservoir free surface of which is at an elevation of...
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from the lower reservoir to the upper reservoir at a volumetric
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at an elevation of “z1” to reservoir the free water surface of
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