The equivalent annual cost can be deﬁned as the annual annuity stream of payments with the same _____ as a project's costs.

Question

Quizplus · Accepted Answer

The equivalent annual cost takes into account the present value of a project's costs and calculates the annual annuity stream of payments with the same present value. Options A and B only consider the total or annual payment amounts, which may not accurately represent the true cost of a project. The erosion and tax effects are not directly related to calculating the equivalent annual cost.

The Equivalent Annual Cost Can Be Deﬁned as the Annual