A Homeowner in Queensland Has the Opportunity to Install a Solar

question 56

Multiple Choice

A homeowner in Queensland has the opportunity to install a solar water heater in his home for a cost of $2400. 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 9% per year.)

• A) $262
• B) $240
• C) $248
• D) $216

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Definitions:

United States

A country located primarily in North America, consisting of 50 states, a federal district, five major self-governing territories, and various possessions.

Comparative Advantage

A concept in international trade that refers to the ability of a country to produce a good or service at a lower opportunity cost than its trade partners.

International Trade

The exchange of goods, services, and capital across international borders or territories.

Cloth Production

The process of creating textile fabrics from natural or synthetic fibers through various methods including weaving, knitting, and felting.