Problem:
The construction of a dam will cost $1,000 at time 0, $500 in year 1, and $500 in year 2. It will be completed at the end of year 2. From year 3, maintenance costs will be $100 per year through year 10. From years 11 on, maintenance costs will be $150 per year forever. Find the present worth of all the costs if i - 10%. Assume all costs incurred to be at the end of the respective year.
a. PW of $1,000 at time 0.
b. PW of $500 in year 1, and $500 in year 2.
c. PW of maintenance costs $100 per year from year 3 through year 10.
d. PW of maintenance costs $150 per year from year 11 through forever.
e) PW of all the costs.