Contemporary Engineering Economics (6th Edition)
6th Edition
ISBN: 9780134105598
Author: Chan S. Park
Publisher: PEARSON
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Question
Chapter 16, Problem 1P
(a):
To determine
Benefit and cost.
(a):
Expert Solution
Explanation of Solution
User’s benefits are prevention from the highway corrosion, rust on vehicle, corrosion to utility lines and damages to water supplies and damages to vegetation and soil surrounding areas.
The sponsor’s costs are paying a higher tax and unknown environmental damages that causes due to the usage of CMA.
(b):
To determine
Salt damages.
(b):
Expert Solution
Explanation of Solution
The damage is calculated by following the given procedure. The state gives exclusive rights to the CMA for a selected area and road salt for another area tor a particular period of time. After that particular time period, It is evaluated the vegetation yield, road salt yield and compared both the result. The difference int eh value is quantified in terms of monetary value.
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Students have asked these similar questions
A company is considering building a bridge across a river. The bridge would cost $2 million to build and nothing to maintain. The following table shows the company's anticipated demand over the lifetime of the bridge:
Price
Quantity
(Dollars per crossing)
(Thousands of crossings)
8
0
7
100
6
200
5
300
4
400
3
500
2
600
1
700
0
800
If the company were to build the bridge, its profit-maximizing price would be $ ?
, and it ( would or would not)? produce the efficient level of output.
If the company is interested in maximizing profit, it (should , or should not)? build the bridge because profit would be
. (Note: If the company incurs a loss, be sure to enter a negative number for profit.)
If the government were to build the bridge, it should charge a price of $ ?
True or False: The government should build the bridge.
True
or
False
Discuss the issues faced when demand for rail and ocean transport does not meet the supply of transport (15 marks)
A project requires signing buying 500 cubic yards of concrete per week for the next year from the only local provider. The currently price is $100 per yard and the provider sells 5,000 yards per week. Assuming marginal cost is constant, elasticity of demand at the current price is -1.5, and using a linear demand approximation, estimate the opportunity cost of the weekly government purchase. The METB is 0.2. Note you will need to find the original demand, the new demand, the new price, and the new quantity purchased by those other than the government in the process.
Chapter 16 Solutions
Contemporary Engineering Economics (6th Edition)
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