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The Long Run Capitalized Cost of an Asset That Initially C0C _ { 0 }

Question 55

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The long run capitalized cost of an asset that initially cost C0C _ { 0 } dollars is given by C=C0+0A(t)ertdtC = C _ { 0 } + \int _ { 0 } ^ { \infty } A ( t ) e ^ { - r t } d t where A(t) is the annual cost of maintenance and r is the annual rate of interest, compounded continuously. Find the long run capitalized cost, in dollars, in the case where C0=$5,000,000C _ { 0 } = \$ 5,000,000 , A(t) = 5, 000(1 + 3t), and r = 0.08.

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