Initial construction bid $2,000,000 Right of way maintenance Major upkeep every six years, starting at the present time Annual benefit to the taxpayers $30,000 per year $50,000 $135,000
Initial construction bid $2,000,000 Right of way maintenance Major upkeep every six years, starting at the present time Annual benefit to the taxpayers $30,000 per year $50,000 $135,000
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
The Adams Construction Company is bidding on a project to install a large flood drainage culvert from Dandridge to a distant lake. If they bid $2,000,000 for the job, what is the benefit-cost ratio in view of the following data? The MARR is 6% per year, and the project’s life is 30 years.
![Initial construction bid
$2,000,000
Right of way maintenance
Major upkeep every six years,
starting at the present time
Annual benefit to the taxpayers
$30,000 per year
$50,000
$135,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F5809eb7c-7fc1-4c24-9201-d282ed8d276e%2F746d1f96-2aa3-48a2-8e66-4b14bf0fb70b%2F24jo0lz_processed.png&w=3840&q=75)
Transcribed Image Text:Initial construction bid
$2,000,000
Right of way maintenance
Major upkeep every six years,
starting at the present time
Annual benefit to the taxpayers
$30,000 per year
$50,000
$135,000
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