Question

Calculate the revenue requirement for a utility under rate of return regulation, using the following information:...

Calculate the revenue requirement for a utility under rate of return regulation, using the following information:

Rate base (B): $500

Cost of equity: 10%

Percentage financed by equity: 40%

Tax rate: 20%

Rate of return: 10%

Expenses: $100

Depreciation: $50

Homework Answers

Answer #1

The formula for Calculating revenue requirement for a utility under rate of return regulation is

R = B*r+E+d+T

The Computation are as follows:

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