What is the benefit-cost ratio and the net benefits of a highway investment with the following characteristics: a. Construction cost: $50,000,000 b. Annual highway operating cost: $500,000 C. Service life: d. Interest rate: 6% 25 years e. Year 1 traffic: 1,000,000 vehicles per year f. Year 1 savings in travel time: 30 minutes, value of travel time savings is $15.00 per hour g. Traffic growth rate: 2% per year compounded annually

What is the benefit-cost ratio and the net benefits of a highway investment with the following characteristics: a. Construction cost: $50,000,000 b. Annual highway operating cost: $500,000 C. Service life: d. Interest rate: 6% 25 years e. Year 1 traffic: 1,000,000 vehicles per year f. Year 1 savings in travel time: 30 minutes, value of travel time savings is $15.00 per hour g. Traffic growth rate: 2% per year compounded annually

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

Chapter14: Pricing Techniques And Analysis

Section: Chapter Questions

Problem 1.1CE: What life cycle cost concept begins raising concerns by year 5 with any electric vehicle (EV)? If...

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