CBA analysis for these two options Option A requires the purchase of a garbage collection vehicle that needs a two-person crew. The vehicle will cost $60,000 and each worker will be paid $20,000 a...

CBA analysis for these two options

Option A requires the purchase of a garbage collection vehicle that needs a two-person crew. The vehicle will cost $60,000 and each worker will be paid $20,000 a year. The city would pick up 400 tons of garbage annually, and for each ton of garbage collected, it would charge a $400 fee. The city would have annual revenue of $160,000 (400 × $400) from this operation.

Option B requires a vehicle for a three-person crew. The vehicle will cost $80,000 and each worker will be paid $15,000 annually. With this option, the city’s garbage collection capacity would be 300 tons annually, so the annual revenue would be $120,000 (300 × $400).

Using a three-year period and a discount rate of 5 percent, which option should be recommended in the budget request?