Question

A homeowner in a sunny climate has the opportunity to install a solar water heater in his home for a cost of $ 2 comma 900. After installation the solar water heater will produce a small amount of hot water every​ day, forever, and will require no maintenance. How much must the homeowner save on water heating costs every year if this is to be a sound​ investment? (The interest rate is 11​% per​ year.)

Answer 1

319

Step-by-step explanation:

Data provided as per the requirement of solution is here below:-

Interest rate = 11%

Solar water heater cost - $2,900

The computation of savings on water is shown below:-

Solar water heater cost = X ÷ Interest rate

2,900 = X ÷ 0.11

X = 2,900 × 0.11

= 319

Therefore the homeowner saves on water heating costs every year is 319.