Several new box stores have created additional congestion at an intersection in north St. John's, Newfoundland. City engineers have recommended the addition of a turn lane, a computer controlled, signal and sidewalks, at an estimated cost of $1,500,000 dollars. The annual maintenance costs at the new intersection will be $10,000, but users will save $50,000 per year due to reduced waiting times. In addition, accidents are expected to decline, representing a property and medical savings/benefits of $160,000 dollars per year. The renovation is expected to handle traffic adequately for a 8 year period. The city uses a MARR of 6 percent. 1. Determine the BCR for this project 2. Determine the BCRM of the project Number Number

Several new box stores have created additional congestion at an intersection in north St. John's, Newfoundland. City engineers have recommended the addition of a turn lane, a computer controlled, signal and sidewalks, at an estimated cost of $1,500,000 dollars. The annual maintenance costs at the new intersection will be $10,000, but users will save $50,000 per year due to reduced waiting times. In addition, accidents are expected to decline, representing a property and medical savings/benefits of $160,000 dollars per year. The renovation is expected to handle traffic adequately for a 8 year period. The city uses a MARR of 6 percent. 1. Determine the BCR for this project 2. Determine the BCRM of the project Number Number

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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2) The council members of a small town have decided that the earth levee that protects the town flooding should be rebuilt and strengthened. The town engineer estimates that the cost of the work at the end of the first year will be $85,000. He estimates that in subsequent years the annual repair costs will decline by $10,000 making the second-year cost $75,000; the third year $65,000, and so forth. The council members want to know what the equivalent present cost is for the first 5 years of repair work if annual effective interest is 4%.
Hotel California, a lovely place along the 101 Highway, last underwent an upgrade in 1969. As a result of its dilapidated conditions, it has plenty of extra rooms. It is considering a major renovation. The construction costs of the renovation are estimated to be $1 million, payable at the end of construction. If the construction starts today, it will last one year. During the renovation, the hotel will be closed to guests (however assume that all of the hotel's expenses, such as paying staff, are unchanged due to long term contracts). Hotel California's capacity is 40 rooms and, on average, 60% of the rooms are vacant on any single day. The daily profit per occupied room is $90. The corporate tax rate is 20%, the appropriate discount rate is 9\% and renovation can be depreciated at 33.3% per year. (a) Compute the average profit per occupied room a year. Then compute the average profit for the hotel as a whole. Assume 365 days per year. (b) Suppose Hotel California decides to begin…
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Help please. My answer is wrong Required information Vancouver Shakespearean Theater's board of directors is considering the replacement of the theater's lighting system. The old system requires two people to operate it, but the new system would require only a single operator. The new lighting system will cost $115,700 and save the theater $24,000 annually for the next eight years. Use Appendix A for your reference. (Use appropriate factor(s) from the tables provided.) Suppose the Vancouver Shakespearean Theater's board is uncertain about the cost savings with the new lighting system. Required: How low could the new lighting system's annual savings be and still justify acceptance of the proposal by the board of directors? Assume the theater's hurdle rate is 12 percent. (Round final answer to 2 decimal places.) X Answer is complete but not entirely correct. Annual $ 27,829.36 x savings
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