Situation4: Calculate the benefit cost ratio for a highway project with the following benefits and costs, The project life is 40 years, the interest rate is 10%, and the project's right of way is worth $5M in 40 years. $20M-----Construction Cost (includes acquiring right of way) $350K----Annual maintenance -------Repaving every 8 years. $1M------Annual value of lives saved (1 per year) $1.25M---Time savings for commercial traffic $20 0.25 hours 250,000 trips $3M-- hour trip year $1M------Time savings for commuter and recreational traffic/year $5 0.25 hours 800,000 trips hour Hint: Benefit cost ratio = trip year Annual benefit costs/ Total cost

Situation4: Calculate the benefit cost ratio for a highway project with the following benefits and costs, The project life is 40 years, the interest rate is 10%, and the project's right of way is worth $5M in 40 years. $20M-----Construction Cost (includes acquiring right of way) $350K----Annual maintenance -------Repaving every 8 years. $1M------Annual value of lives saved (1 per year) $1.25M---Time savings for commercial traffic $20 0.25 hours 250,000 trips $3M-- hour trip year $1M------Time savings for commuter and recreational traffic/year $5 0.25 hours 800,000 trips hour Hint: Benefit cost ratio = trip year Annual benefit costs/ Total cost

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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