You have discovered a potential change in the design of a pumping station floor via a Value Engineering Workshop. The two alternatives are described in the table below. Use an Opportunity Cost of 4% per year and a 30-year life cycle. Draw a Cash Flow Diagram (0.25 points) and give the Present Worth for each of the alternatives. Is the change to Ceramic Tile worth it? (show all table work)
Floor System First Cost Annual Cost 10 and 20 Year Upgrade
Commercial Tile $10,000 $1,200 $8,000 at 20 years only
Ceramic Tile $19,000 $500 $3,000 at both 10 and 20 years