Badang Builder Sdn. Bhd. has won a tender to build a 10km toll road. Initial cost of the project is RM 4,000,000. The main contractor will pay RM 20,000 for the operational cost every 3 months to the subcontractor for 2 years. The road needs to carry out resurfacing works every 5 years with a cost of RM 400,000. It is expected that the road can be completed at the end of year 2. After completion, annual operational cost for the road is about RM 100,000 forever. The company wishes to estimate the minimum annual income from the toll collection for a period of 15 10% per year compounded annually. The asks you to do this analysis. Assume that the growth rate is years. company

Badang Builder Sdn. Bhd. has won a tender to build a 10km toll road. Initial cost of the project is RM 4,000,000. The main contractor will pay RM 20,000 for the operational cost every 3 months to the subcontractor for 2 years. The road needs to carry out resurfacing works every 5 years with a cost of RM 400,000. It is expected that the road can be completed at the end of year 2. After completion, annual operational cost for the road is about RM 100,000 forever. The company wishes to estimate the minimum annual income from the toll collection for a period of 15 10% per year compounded annually. The asks you to do this analysis. Assume that the growth rate is years. company

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

Problem 1PS

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