Question 7 Part C: Oregon is examining how to allocate funding over the next five years and have arrived at four projects that are in contention. The numerical details are listed below (Oregon uses a MARR of 10% for new projects): Project 105 205 305 405 Initial Cost 2,500,000 2,500,000 3,000,000 2,000,000 Annual Maintenance 250,000 250,000 200,000 300,000 Cost Yearly Benefit 1,000,000 900,000 900,000 1,000,000 Yearly Disbenefit 15,000 10,000 0 100,000 B/C Ratio 1.08 0.98 0.91 1.09 Question 7 Part C: If we assume we have to compute an incremental analysis between Projects 105 and 405, what would the incremental B/C ratio between the two projects be? Enter your answer in the format: 1.23
Question 7 Part C: Oregon is examining how to allocate funding over the next five years and have arrived at four projects that are in contention. The numerical details are listed below (Oregon uses a MARR of 10% for new projects): Project 105 205 305 405 Initial Cost 2,500,000 2,500,000 3,000,000 2,000,000 Annual Maintenance 250,000 250,000 200,000 300,000 Cost Yearly Benefit 1,000,000 900,000 900,000 1,000,000 Yearly Disbenefit 15,000 10,000 0 100,000 B/C Ratio 1.08 0.98 0.91 1.09 Question 7 Part C: If we assume we have to compute an incremental analysis between Projects 105 and 405, what would the incremental B/C ratio between the two projects be? Enter your answer in the format: 1.23
Chapter1: Making Economics Decisions
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Transcribed Image Text:Question 7 Part C: Oregon is examining how to allocate funding over the next five years and have arrived at four projects that are in contention. The numerical details are listed below
(Oregon uses a MARR of 10% for new projects):
Project
105
205
305
405
Initial Cost
2,500,000 2,500,000 3,000,000 2,000,000
Annual
Maintenance 250,000
250,000 200,000 300,000
Cost
Yearly Benefit
1,000,000
900,000
900,000 1,000,000
Yearly Disbenefit 15,000
10,000
0
100,000
B/C Ratio
1.08
0.98
0.91
1.09
Question 7 Part C: If we assume we have to compute an incremental analysis between Projects 105 and 405, what would the incremental B/C ratio between the two projects be? Enter
your answer in the format: 1.23
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