The city of Brussels is installing a new swimming pool in the downtown recreation centre. One design being considered is a reinforced concrete pool that will cost €6 000 000 to install. Thereafter, the inner surface of the pool will need to be refmished and painted every 10 years at a cost of €4 0 000 per refinishing.
Assuming that the pool will have essentially an infinite life, what is the present worth of the costs associated with the pool design? The city uses a MARR of 5%. If the installation costs, refinishing costs, and MARR are subject to 5% or 10% increases or decreases, how is the present worth affected? To which parameter is the present worth most sensitive?