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Question(s) / Instruction(s):

A new toll bridge across the Hudson River is being considered to replace the Tappan Zee Bridge.  Investment cost are expected to be $18,000,000, Operating expense will be $375,000 per year and the bridge must be resurfaced every 5th year of its 30 year life at a cost of 1,250,000. Toll revenue is expected to be 2,800,000 in the first year and increase by $50,000 each year due to increased traffic.  Assuming zero salvage value at the end of the 30 year life and a MARR = 9%, should the bridge be constructed?

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