CME 182 Engineering Design and Graphics CME 250 Statics CME 260 Mechanics of Materials CME 390 Composites Manufacturing CME 401 Engineering Economics CME 420 Manufacturing Systems Analysis CME 475 Design Project I CME 480 Design Project II
Office Hours D2L Brightspace Dept of Composite Materials Engineering
Professor Dennehy
Department of Composite Materials Engineering
Stark Hall 203F (507) 457-5276 kdennehy@winona.edu
CME 401 Engineering Ecomonics
Description Information Objectives Calendar Requirements
Depreciation Income Taxes Cash Flows Inflation Capitalized Costs Deciding on Investments Bonds
Homework Problems

Capitalized Costs

1. A dam with a 100-year life has an initial cost of $15 million. The gates in the dam must be replaced every five years, at a cost of $2 million. The interest rate is 8% per year, compounded annually.

What is the capitalized equivalent of the annual cost of the dam?

What is the total present worth of the dam?