The general city population is set to experience a benefit expressed in present worth of $35,500,000 in terms of travel time savings from a municipal road project. The local government will incur an initial spending of $11,500,000 and an annual operating and maintenance cost of $200,000. This new road will generate annual tolls amounting to $100,000. Consider a 3-year period an an interest rate of 5%. What is the benefit-cost ratio of this project? [Enter your response to two decimal points]

The general city population is set to experience a benefit expressed in present worth of $35,500,000 in terms of travel time savings from a municipal road project. The local government will incur an initial spending of $11,500,000 and an annual operating and maintenance cost of $200,000. This new road will generate annual tolls amounting to $100,000. Consider a 3-year period an an interest rate of 5%. What is the benefit-cost ratio of this project? [Enter your response to two decimal points]

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: A student has agreed to purchase a used vehicle for $10,000. He wishes to limit his monthly payment…

A: According to question Interest rate = 6%Per annum Monthly rate of interest (r) = 0.5% =0.005 Used…

Q: Urban infrastructures that support a community are sometimes in the news; we seldom think about them…

A: DISCLAIMER “Since you have asked multiple questions, we will solve the first question for you. If…

Q: A man decides to run a hot dog stand as a side hobby. He makes an initial investment of $1,264 which…

A: Hi there , as you have posted multiple questions we can only answer one at a time as per our…

Q: In order to improve evacuation routes out of New Orleans in the event of another major disaster such…

A: Present value is the current value of future cash flows or payments. It is the discounted value of…

Q: Plastics recycling equipment is estimated to cost $300K. It will increase profit by $75K per year…

A: Cost of Equipment 300000 Profit 75000 Upgrade Cost 50000 MARR 0.15 Life 8

Q: ompany is alternatives. Alternative A requires an initial investment of $10,000; it will yield…

A: Revenue is the total amount of income generated by the sale of goods or services related to the…

Q: Seven years ago a New Brunswick logging company purchased a used wood chipperfor $117,000 for…

A: The objective of the question is to calculate the annual worth of the wood chipper considering its…

Q: Briana received a 10-year subsidized student loan of $22,000 at an annual interest rate of 4.125%.…

A: The equal monthly payment is the fixed amount paid by the borrower to the lender to repay the…

Q: Using i of 6.5%, compare the net present worth of the net expenditures for the two proposed plans…

A: Annual worth or AW is referred to as the easy way of understanding the annual amount, for instance,…

Q: c) The Selangor state government is seeking a proposal to take over the maintenance of dilapidated…

A: 1) 0+5.463+5.573/2.8+5.463+2.832)0+5.463+5.573/7.67

Q: The management of an electronics manufacturing firm believes it is desirable to automate its…

A: Present value (PV) calculates the current value of an amount of money – or a stream of cash flows…

Q: Use Present Worth Analysis to determine whether Alternative A or B should be chosen. Items are…

A: The amount of money that, if invested today at a certain rate of compound interest, will exactly…

Q: None

A: Incremental Rate of Return Comparisons:Compare A vs. B:\Delta EAC = EAC_B - EAC_A = -8697 + 2652 =…

Q: 3 If a project schedule is accelerated, it is possible to complete the project in B-months rather…

A: Present worth, also known as present value, refers to the current value of a future stream of cash…

Q: The five mutually exclusive alternatives shown below are under consideration for improving visitor…

A: Present worth (PW), also known as present value (PV), is a financial concept used to assess the…

Q: a. The PW of the Gas Heating Option is b. The PW of the Geothermal Heating Option is c. The lower…

A: * SOLUTION :- *(A)

Q: Problem 3 20 The engineering department estimates that waste treatment costs will be $50,000 for the…

Question

The general city population is set to experience a benefit expressed in present worth
of $35,500,000 in terms of travel time savings from a municipal road project. The
local government will incur an initial spending of $11,500,000 and an annual
operating and maintenance cost of $200,000. This new road will generate annual
tolls amounting to $100,000. Consider a 3-year period an an interest rate of 5%.
What is the benefit-cost ratio of this project? [Enter your response to two decimal
points]

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Complete the following analysis of cost alternatives and select the preferred alternative. The study period is 10 years and the MARR = 10% per year. "Do Nothing" is not an option. A B $15,000 $16,100 240 290 1,000 1,250 -$41,731 - $45,131 Capital investment Annual costs Market value at EOY 10 FW (10%) Click the icon to view the interest and annuity table for discrete compounding when i = 10% per year. The FW of the alternative C is $. (Round to the nearest dollar.) Select the preferred alternative. Choose the correct answer below. OA. Alternative C OB. Alternative A OC. Alternative B O D. Alternative D D $17,900 110 1,950 ??? - $46,231 с $12,500 450 1,800
An engineering student intends to purchase a new computer. He plans to pay $300 down and finance the remainder over a 12 month period. The maximum amount that he can repay each month is $100. a. What is the most expensive computer he can purchase, assuming an interest rate of 2% per month (compounded monthly)? b. Draw the Cash Flow Diagram for this problem.
No excel, full work thanks
Please fill out the spaces and answer the questions. Use table provided.
A firm wants to sponsor a new engineering lab at a local university. This requires $4.0M to construct the lab, $1.5M to equip it, and $750,000 every 6 years for new equipment. What is the required endowment if the university will earn 8% interest on the funds?
A city is planning to renovate their current facility with hi-tech computerized systems. Four plans are proposed by the engineers. Each plan will save $950,000 annually but their cost is different. The benefits will last for 30 years. Based on a benefit-cost analysis what should the agency do, if i = 10%? Initial Cost Annual O & M A $7,250,000 $90,000 B D E F C $6,000,000 $6,500,000 $7,500,000 $8,000,000 $5,500,000 $110,000 $140,000 $80,000 $150,000 $60,000 FOCUS
Help....
Littrell's Nursery needs a new irrigation system. System one will cost $145,000, have annual maintenance costs of $10,000, and need an overhaul at the end of year six costing $30,000. System two will have first year maintenance costs of $5,000 with increases of $500 each year thereafter. System two would not require an overhaul. Both systems will have no salvage value after 12 years. If Littrell's cost of capital is 4%, using annual worth analysis determine the maximum Littrell's should be willing to pay for system two.
A transit system is considering buying 6 more buses to provide better service. It will cost $100,000 for buying a new bus and $15,000 per year for maintenance and operation for the following 8 years. If the city’s MARR is 8%, what is the equivalent uniform annual cost of this project? Assume the bus has no value at the end of 8 years.
6
PLEASE TAKE INTO ACCOUNT THAT "g" EQUALS 7 IN THIS PROBLEM AND PLEASE DRAW THE CASH FLOW DIAGRAM