3 Five mutually exclusive, direct benefit alternatives are compared using the B/C method. The alternative to select is: a. J b. K c. L d. M Alternative J K L M N Total Investment, $ million 20 25 33 45 49 Overall B/C Ratio 1.02 1.18 1.12 0.89 0.94 AB/C When Compared to Alternative J - K L M N 1.20 1.42 0.98 0.72 0.80 0.08 0.84 0.89 0.76 1.32

3 Five mutually exclusive, direct benefit alternatives are compared using the B/C method. The alternative to select is: a. J b. K c. L d. M Alternative J K L M N Total Investment, $ million 20 25 33 45 49 Overall B/C Ratio 1.02 1.18 1.12 0.89 0.94 AB/C When Compared to Alternative J - K L M N 1.20 1.42 0.98 0.72 0.80 0.08 0.84 0.89 0.76 1.32

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

Chapter17: Long-term Investment Analysis

Section: Chapter Questions

Problem 10E

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3. Consider the two alternative investments. Year Alt. X Alt. Y -200 -200 +99 +150 +99 -85 +99 +248 Determine the B/C ratio of each alternative Determine which investment is preferable by using incremental benefit- b) cost ratio analysis. Take i= 12% 3.
. There is five alternatives for improvement of a road. Determine which alternative should be chosen if the highway department is willing to invest money as long as there is a B/C ratio of at least .00. LAlternatives Annual Benefits Annual Cost A P900, 000 P1. 000,000 B P1. 300,000 PI. 400,000 P2. 800.000 P2, 100,000 D P3, 300,000 P2, 700,000 E P1. 200,000 P3. 400,000
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5. Assume EUAB -SI8,733 ( ia notf). The BenefitCost ratio is closest to a) 1.49 b) 1.45 c) 1.58 d) 1.73 c) 2.19 0241 ) 2.07
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vered of 10.00 ion Calculate the conventional benefit-cost ratio for the alternative: Initial Investment Revenues Costs Salvage Value Useful life MARR Select one: a.1.3130 b.1.2960 c.1.4659 d.1.3681 e.1.2114 Determine the FDD ( 350000 150000 55000 120000 7 0.1
In the development of a publicly owned, commercial waterfront area, three possible independent plans are being considered. Their estimated costs and estimated benefits are as follows. Increment considered Incremental A (A-C) A (B-A) Plan A B $123,000 135,000 99,000 12000 Costs 24000 costs Benefits $ 139,000 150,000 114,000 Incremental 25000 11000 Benefits В-С 1.13 1.11 1.15 A (B C) 1.04 0.916 which plan should be selected? O A O Do nothing O B
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N5 The following data is provided for a PPP project. To the People To the Government Benefits $130,000 per year beginning now Cost $1.8 million now and $200,000 every 3 years Disbenefits $45,000 per year Savings $90,000 per year Calculate the conventional benefit/cost ratios using an interest rate of 6% per year and an infinite project period.
Given a single alternative for a proposed government project, if the alternative's benefit-cost ratio is 1.4, then the project O Should be accepted. Should not be accepted. Should be reevaluated to increase its ratio. Is not good enough for a government project. Show Transcribed Text Public investment projects should provide benefits for the public's greater good that exceed the payback period present worth annual worth costs of providing those benefits.