ne city of Oakmont is interested in developing some lake front property into a sports park (picnic facilties, boat docks, swimming area, etc.). A consultant has estimated that the city would need to invest $3 million in this project. In retum, the developed property would return $500,000 per year to the city through increased x revenues and recreational benefits to the public. What would the life of this project need to be in order to be cost-beneficial to the city? The interest rate on municipal bonds is 4% per year. Click the icon to view the interest and annuity table for discrete compounding when i4% per year. ne life of the project needs to b t least voars in order to be cost.beneficial the nearest whole number)

ne city of Oakmont is interested in developing some lake front property into a sports park (picnic facilties, boat docks, swimming area, etc.). A consultant has estimated that the city would need to invest $3 million in this project. In retum, the developed property would return $500,000 per year to the city through increased x revenues and recreational benefits to the public. What would the life of this project need to be in order to be cost-beneficial to the city? The interest rate on municipal bonds is 4% per year. Click the icon to view the interest and annuity table for discrete compounding when i4% per year. ne life of the project needs to b t least voars in order to be cost.beneficial the nearest whole number)

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter17: Long-term Investment Analysis

Section: Chapter Questions

Problem 9E

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In the table below presented the data on the investment in the renewable energy source (wind farm). This wind farm will be located in the scenic area (has a visual impact on the communities close by). Costs are estimated as follows: Construction cost = $750,000 Maintenance cost = $5,000 per year for the next 15 years Cost of dismantling at the end of 15-year lifespan = $35,000 Compensation for view loss = $25 annually per household for 2,000 household Benefits as follows: Market value of electricity = $150,000 per year Directions: 1. Construct the table for CBA analysis 2. Calculate present value (PV) of costs and benefits using the CBA table 3. Conduct a CBA test (as difference between present value of benefits and costs) 4. Make a decision on investment (Yes/No)
build a modelAn industrial park is being planned for a tract of land near a river. To prevent flood damage to the industrial buildings that will be built on this low-lying land, an earthen embankment can be constructed. The height of the embankment will be determined by an economic analysis of the costs and benefits.The following data have been gathered (Tables 1 and 2). The embankment is expected to last 40 years and will require no maintenance.Whenever the flood water flows over the embarkment, a $310,000 in annual damages occur. The corporation uses an interest rate of 15% a) if they build the embarkment, what height should it have? Table 1 Table 2 Embankment Height Above Roadway (m) Initial Cost ($) Embankment Height Above Roadway (m) Avg Frequency That Flood Level Will Exceed heigh of embarkment 2.0 $ 100,000.00 2.0 Once in 3 years 2.5 $ 165,000.00 2.5 Once in 8 years 3.0 $ 300,000.00 3.0 Once in 25 years 3.5…
With interest at 10%, what is the benefit-cost ratio for this government project? Initial Cost $201,767 Additional costs at the end of year 1 and year 2 Benefits at end of year 1 and year 2 Annual benefits at end of year 3 through year 10 Enter your answer as follow: 12.34 $28,755/year $0/year $108,308/year
Please solve, show and explain steps. This is Engineering Economics.
On this least-cost abatement curve, how much (GtCO2) could we abate if we spent €8.37 billion A) 8.37 GtCO2 B) 11.2 GtCO2 C) 6.26 GtCO2 D) 4.94 GtCO2
A local government is considering promoting to urism in the city. It will cost$8,000 to develop a plan. The anticipated annual benefits and costs are as follows:Annual benefits: Increased local income and tax collections $ 125,000Annual support service: Parking lot expansion, rest room. $50,000patrol car, and street repairIf the city government uses a discount rate of 8% and a study period of fiveyears. is this tourism project justifiable according to the benefit-cost analysis?
1. Use the first four steps of the decision-making process to generally describe the alternatives and identify what economic-related estimates you will need to complete an engineering economy analysis for the president. 2. Identify any noneconomic factors and criteria to be considered in making the alternative selection. 3. During your inquiries about alternative B from its manufacturer, you learn that this company has already produced a prototype molding machine and has sold it to a company in Germany for $3 million (U.S.dollars). Upon inquiry, you further discover that the German company already has unused capacity on the equipment for manufacturing plastic shells.The company is willing to sell time on the equipment to Innovations immediately to produce its own shells for U.S.delivery. This could allow immediate market entry into the United States.Consider this as alternative C,and develop the estimates necessary to evaluate C at the same time as alternatives A and B.
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The city of Jefferson is reviewing the benefits and costs of a potential universal water-metering program. Two options are considered:• Option I: Treated Surface Water Only Benefits of Deferring/DownsizingWater and Sewer Projects-$28.l millionCosts of Metering-$9.3 million Benefit-Cost Ratio-3.02• Option 2: Treated Surface Water Supplemented By 40 MUDay Groundwater Benefits of Deferring/Downsizing Water and Sewer Projects-$38.9 millionCosts of Metering (and groundwater development)-$14.7 millionBenefit-Cost Ratio-2.65 Which option should the city implement, assuming that the city has enough money to fund either project?(a) Option 1.(b) Option 2.(c) Neither.( d) Both options.