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Building a regulated water bill from its blocks
The prompt
Riverbend Water (a fictional company in England) has a regulatory capital value of GBP 10 billion. The regulator allows operating costs of GBP 800 million a year, run-off (depreciation) of GBP 400 million a year and a return of 4.03 percent a year. It bills 2.5 million households. What is its allowed revenue, and the average bill per household? Then recompute the bill with a return of 4.20 percent.
Your interviewer will share data as you ask for it. Ask clarifying questions, state a hypothesis, then lay out your structure out loud before you calculate.
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