The Camino Real Landfill was required to install a plastic liner to prevent leac

Question

The Camino Real Landfill was required to install a plastic liner to prevent leachate from migrating into the groundwater. The fill area was 42,000 m2 and the installed liner cost was $8 per m2. In order to recover the investment, the owner charges to unload at the rates of $12 per pickup, $25 per dump truck, and $70 per compactor truck load. The fill area is adequate for 6 years. If the annual traffic is estimated to be 2500 pickup loads, 650 dump-truck loads, and 1200 compactor-truck loads, what rate of return will the landfill owner make on the investment?

The rate of return that will be made by the landfill owner is  % per year.

Explanation / Answer

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Fill area 42000 A B C D E F G Liner cost/m^2 8 Year 0 1 2 3 4 5 6 Total Investmnt =Fill area* Liner cost 336000 1 Initial Investment -336000 2 Annual Charges of Pickup 30000 30000 30000 30000 30000 30000 Rate of Pickup 12 3 Annual Charges of Dump Truck 16250 16250 16250 16250 16250 16250 Annual Pickup 2500 4 Annual charges Compactor Truck Load 175000 175000 175000 175000 175000 175000 Annual Charges of Pickup 30000 2500*12 5 Total Cash flows -336000 221250 221250 221250 221250 221250 221250 6 Reuired rate is IRR 62.24% IRR(A5:G5) Rate of Dump truck 25 Annual Dump Truck 650 Annual Charges of Dump Truck 16250 25*650

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