An oil and gas producing company owns 49,000 acres of land in a southeastern state. It operates 650 wells which produce 19,000 barrels of oil per year and 1.5 million cubic feet of natural gas per year. The revenue from the oil is $1,900,000 per year and for natural gas the annual revenue is $583,000 per year. What bid should be made to purchase this property if the potential buyer is hoping to make 17% per year on his investment over a period of 9 years. Click the icon to view the interest and annuity table for discrete compounding when i= 17% per year. $ million or less should be offered for the property. (Round to two decimal places.)

An oil and gas producing company owns 49,000 acres of land in a southeastern state. It operates 650 wells which produce 19,000 barrels of oil per year and 1.5 million cubic feet of natural gas per year. The revenue from the oil is $1,900,000 per year and for natural gas the annual revenue is $583,000 per year. What bid should be made to purchase this property if the potential buyer is hoping to make 17% per year on his investment over a period of 9 years. Click the icon to view the interest and annuity table for discrete compounding when i= 17% per year. $ million or less should be offered for the property. (Round to two decimal places.)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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