4.Consider the following a highway investment with the following characteristics: a. Construction cost: $50,000,000 b. Annual highway operating cost: $500,000 c. Service life: 25 years d. Interest rate: 6% e. Year 1 traffic: 1,000,000 vehicles per year f. Year 1 savings in travel time: 30 minutes, value of travel time savings is $15.00 per hour g. Traffic growth rate: 2% per year compounded annually a. What is the benefit-cost ratio?

4.Consider the following a highway investment with the following characteristics: a. Construction cost: $50,000,000 b. Annual highway operating cost: $500,000 c. Service life: 25 years d. Interest rate: 6% e. Year 1 traffic: 1,000,000 vehicles per year f. Year 1 savings in travel time: 30 minutes, value of travel time savings is $15.00 per hour g. Traffic growth rate: 2% per year compounded annually a. What is the benefit-cost ratio?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: 3. The table below provides cash flows for two mutually exclusive alternatives for developing a "Pay…

A: We will use Present Value approach to identify best alternative among given alternatives. Present…

Q: If the town's MARR is 10% per year, use the B-C ratio method to determine which system is best.…

A: The capital investment cost is the initial cost of investing in a specific project or asset. The…

Q: 7. Two machines are considered for purchase. Assume 10% interest, Use Benefit Cost analysis. Machine…

A: “Since you have posted a question with multiple sub parts, we will provide the solution only to the…

Q: Two schemes: X & Y have been offered to Eric. Scheme X camands initial investment of $10K and $3k…

A: Payback period shows the recovery period of initial investment. Discounted Payback period considers…

Q: Initial Cost, $ Uniform annual benefit, $ per year A $770.00 420.00 Useful life, years 2 B 1406.30…

A: To calculate the Present Worth (PW), we'll use the formula:Where:C = Initial CostA = Annual Benefiti…

Q: (a) A mining firm makes annual deposits of $500,000 into a reclamation fund for 30 years. If the…

A: Given Annual deposits A= $500,000 Future amount F=20 million or $20,000,000 n =30 we have to find…

Q: |3| 16. Use incremental analysis to select the best altematives using Benefit- Cost ration E F A B…

A: A benefit–cost ratio is an indicator, used in cost–benefit analysis, that attempts to summarize the…

Q: Economics A proposed project will cost $1,000 two years from today. Beginning at the end of year…

A: Given The initial cost for the project occurs 2 years from today = $1000 From the end of year 5 to…

Q: Capital investment Annual 0&M costs Electricity sales Decommissioning 50MW onshore €65M €40k per 2MW…

A: Given information Capital investment=65M for 50MW Annual expenditure=1M Annual revenue=8.2M Salvage…

Q: An appraisal is being carried out for two alternative projects with the cash flows shown below.…

A: Given: i= 10%

Q: Some mill investment project ,construction period of 2 years, 18- year production, infrastructure…

A: Given: Let the expected annual profit be x. The values will be seen as: End of the year from 0 to 1…

Q: 14. R TOPIC: ENGINEERING ECONOMICS PLEASE ANSWER IN 4 DECIMAL POINTS

A: The total annual cost of machine A is equal to the sum of capital recovery cost and annual operating…

Q: 2. What is the expected profit for this project? (a) $540,000 (b) $0 (c) $600,000 (d) $530,000 (e)…

A: The "optimal" strategy is the firm's decision which gives the highest expected value. The "optimal"…

Q: what is the capitalized cost (CC) of painting at an interest rate of 10% per year

A: The question is about calculating the capitalized cost of painting a public bridge.Capitalized cost…

Q: 3 If a project schedule is accelerated, it is possible to complete the project in B-months rather…

A: Present worth, also known as present value, refers to the current value of a future stream of cash…

Q: Using LCM Method (Unequal Lives) solve the problem: Two location alternatives A and B, where one can…

A: Alternative selection can be done using present worth analysis but to perform present worth…

Q: 2. Mnvircaneand Partners produces its own electric power. The plant's power capacity exceeds its own…

A: NPV is a capital budgeting tool to decide on whether the capital project should be accepted by the…

Q: Consider the following. (Use the FHA Maximum Loan Values by State table.) Sale Price State…

A: The stipulated minimal sum of money needed to purchase or invest in a security, asset, or…

Question

4. Consider the following a highway investment with the following characteristics:
a. Construction cost: $50,000,000
b. Annual highway operating cost: $500,000
c. Service life:
25 years
d. Interest rate: 6%
e. Year 1 traffic: 1,000,000 vehicles per year
f. Year 1 savings in travel time: 30 minutes, value of travel time savings is $15.00 per hour
g. Traffic growth rate: 2% per year compounded annually
a. What is the benefit-cost ratio?
stion 15
4b. What is the net benefit?

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Problem 2 Consider the following sets of investment projects n(years) A($) B($) C($) D($) 0 -3,500 -5,800 -5,200 -40,000 1 600 3,000 2,000 12,000 2 600 2,000 4,000 14,000 3 1,000 1,000 2,000 18,000 4 1,000 500 4,000 18,000 5 1,000 500 2,000 14,000 Compute the equivalent annual worth of each project at i-10% and determine the acceptability of each project.
Google Jnc. went public on August 20, 2004. The initial public offering price was $108 per share. If the stock traded al $490.92 on August 19, 2011. what would the compound annual return on investment be for the investors who purchased the stock and held it for eight years? (a) 354%(b)44.31%(c) 20.89%(d) 71 %
The-Public Works Department of a city plans to repave some of the city streets in its 6-year budget. The plan calls for the expenditures of $20.000 at the end of the first year, $10,000 each at the end of the second and third year, and $12,000 each at the end of the fourth, fifth, and sixth year. If the annual rate is 6%, what is the present value of the expenditures? Select one: a. 55,078.7 b. 63,095.8 c. 67,078.6
1.) What are the 3 assumptions that must be considered when using the LCM approach in comparing PW of differentlife alternatives? Question 2 in image, thank you.
1. Which of the following vectors represent a simple lottery? Which represent a degenerate lottery? (a) (0,1,0,0,0, 0) (b) (}, 2,0, , 1) (c) (? (d) (0,1) (e) (0, 3, 0) 6. 5, 4 1 1 3' 3' 3' 3
9. Energy costs for green chemical treatment have increased uniformly over the past 5 years. If costs in year 1 are $26,000 and increase by $2,000 per year through year 5, the present value of the costs at 10% per year is: A. $102,900 B. $112,300 C. $122,100 D. $195,800 Please solve based the option max 15 minutes ASAP