A tax exempt municipality is considering the construction of a new municipal waste water treatment facility. Two different sites have been selected as technically, politically, socially, and financially feasible. The city council uses 6% interest rate for all analyses for public projects. The expected cash flow for the two alternatives are as follow: Year Alt. A Alt. B 0-$15,361,975 - $26,030,799 1- $2,184,416/year $2,830,910/year 75 What is the incremental benefit/cost ratio?
A tax exempt municipality is considering the construction of a new municipal waste water treatment facility. Two different sites have been selected as technically, politically, socially, and financially feasible. The city council uses 6% interest rate for all analyses for public projects. The expected cash flow for the two alternatives are as follow: Year Alt. A Alt. B 0-$15,361,975 - $26,030,799 1- $2,184,416/year $2,830,910/year 75 What is the incremental benefit/cost ratio?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Transcribed Image Text:A tax exempt municipality is considering the construction of a new municipal waste water treatment
facility. Two different sites have been selected as technically, politically, socially, and financially feasible.
The city council uses 6% interest rate for all analyses for public projects. The expected cash flow for the
two alternatives are as follow:
Year Alt. A
Alt. B
0 -$15,361,975- $26,030,799
1-
$2,184,416/year $2,830,910/year
75
What is the incremental benefit/cost ratio?
Enter your answer as follow: 12.34
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