Dome Renovations (p06)

Renovations to the Carrier Dome were expected to cost about $118 million. Suppose that the upgrades all have a useful life of 30 years, and that the University uses an 8% interest rate in present value calculations.

1. Please draw an appropriate cash flow diagram and calculate the annual levelized cost of the upgrade to the nearest $100,000. You may assume $118 million is the present value of all of renovation costs (that is, it is already the PV of the actual costs).