The construction cost of the bypass is $20 million, and $500,000 would be required each year for annual maintenance. The annual benefits to the public have been estimated to be $2.7 million. If the study period is 50 years and the state’s interest rate is 8% per year, should the bypass be constructed?
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- The government of the Republic of Zambia plans to implement an irrigation project to increase maize production in your district. List the possible intangible costs of the projectThe city of Oak Ridge is considering the construction of a four kilometer (km) greenway walking trail. It will cost $1,000 per km to build the trail and $300 per km per year to maintain it over its 20-year life. If the city’s MARR is 7% per year, what is the equivalent uniform annual cost of this project? Assume the trail has no residual value at the end of 20 years.Using exactly the same information from Problem No. 1 above, calculate the Annual Worth of Project X at 8% per year interest rate. You can see the data in picture 1, please answer this problem asap. Thank you for your help.
- The city of Oak Ridge is considering the construction of a three kilometer (km) greenway walking trail. It will cost $1,000 per km to build the trail and $320 per km per year to maintain it over its 23-year life. If the city's MARR is 10% per year, what is the equivalent uniform annual cost of this project? Assume the trail has no residual value at the end of 23 years.A dam is proposed on a stretch of wild river, a river that is currently used for recreation. The dam will generate electricity. The dam will have a useful life of 50 years, after which its reservoir will be full of sediment and the dam will need to be removed. The following are characteristics of the dam: Initial Cost: $100,000,000 Electricity produced: 100,000 MWh per year, at $100/MWh. Cost of decommissioning dam: $10,000,000. Value of recreation lost: $5,000,000 per year. 1. If the social discount rate is 3% per year, is the dam a good idea? 2. If the social discount rate is 10% per year, is the dam a good idea? 3. Calculate the "cutoff" discount rate, c3 such that the dam is a good idea for discount rates c.The International Parcel Service has installed a new radio frequency identification system to help reduce the number of packages that are incorrectly delivered. The capital investment in the system is $65,000, and the projected annual savings are tabled below. The system’s market value at the EOY five is negligible, and the MARR is 18% per year. Calculate the present worth of the project.
- • Five water treatment plants (WTPs) have been proposed for a city. Each of the plant have a useful life of years and the interest rate is 10% per year. The benefits and costs of the WTPs are listed below. The useful life of WTPA, WTPB, WTPC, WTPD, and WTPE are 20, 25, 30, 35, and 40 years, respectively. Determine the WTP which is economically best. Use incremental B/C ratio method. Benefits and Costs of 5 WTP (USD millions) WTPA WTPB WTPC WTPD WTPE Capital Investment 15 17 14 16 18 Annual Operation and Maintenance Cost 0.65 0.75 0.63 0.64 0.70 Annual Expected Reduction in Fish Damages 3.0 3.2 1.7 3.1 3.5 Salvage 0.2 0.1 0.3 0.2 -0 10 0.1Ken Allen, capital budgeting analyst for Bally Gears, Inc., has been asked to evaluate a proposal. The manager of the automotive division believes that replacing the robotics used on the heavy truck gear line will produce total benefits of $560,000 (in today's dollars) over the next 5 years. The existing robotics would produce benefits of $400,000 (also in today's dollars) over that same time period. An initial cash investment of $220,000 would be required to install the new equipment. The manager estimates that the existing robotics can be sold for $70,000. Show how Ken will apply marginal cost-benefit analysis techniques to determine the following: The marginal (added) benefits of the proposed new robotics is $______________ The marginal (added) cost of the proposed new robotics is $__________________ The net benefit of the proposed new robotics isFor each of the following problems, (a) draw the cash flow diagram (as needed); (b) present clean and clear manual solutions to the problem; (c) highlight the final answer (only the final answer as required by the problem) by enclosing it within a box. No use of excel The Ecology Group wishes to purchase a piece of equipment for recycling of various metals. Machine 1 costs $123,000, has a life of 10 years, an annual cost of $5,000, and requires one operator at a cost of $24 per hour. It can process 10 tons per hour. Machine 2 costs $70,000, has a life of 6 years, an annual cost of $2,500, and requires two operators at a cost of $24 per hour each to process 6 tons per hour. Assume interest rate at 7% per year and 2080 hours per work year. Determine the annual breakeven tonnage of scrap metal and select the better machine for a processing level of 1,500 tons per year.
- A new highway is to be constructed. Design A calls for a concrete pavement costing $85 per foot with a 16-year life; three paved ditches costing $4 per foot each; and four box culverts every mile, each costing $8,000 and having a 16-year life. Annual maintenance will cost $1,700 per mile; the culverts must be cleaned every four years at a cost of $400 each per mile. Design B calls for a bituminous pavement costing $40 per foot with a 8-year I four sodded ditches costing $1.45 per foot each; and two pipe culverts every mile, each costing $2,200 and having a 8-year life. The replacement culverts will cost $2,500 each. Annual maintenance will cost $2,600 per mile; the culverts must be cleaned yearly at a cost of $220 each per mile; and the annual ditch maintenance will cost $1.65 per foot per ditch. Compare the two designs on the basis of equivalent worth per mile for a 16-year period. Find the most economical design on the basis of AW and PW if the MARR is 8% per year. Click the icon to…A new highway is to be constructed. Design A calls for a concrete pavement costing $90 per foot with a 12-year life; two paved ditches costing $4 per foot each; and two box culverts every mile, each costing $7,000 and having a 12-year life. Annual maintenance will cost $1,700 per mile; the culverts must be cleaned every three years at a cost of $550 each per mile. Design B calls for a bituminous pavement costing $40 per foot with a 6-year life; three sodded ditches costing $1.50 per foot each; and three pipe culverts every mile, each costing $2,100 and having a 6-year life. The replacement culverts will cost $2,350 each. Annual maintenance will cost $2,600 per mile; the culverts must be cleaned yearly at a cost of $230 each per mile; and the annual ditch maintenance will cost $1.30 per foot per ditch. Compare the two designs on the basis of equivalent worth per mile for a 12-year period. Find the most economical design on the basis of AW and PW if the MARR is 6% per year. Click the…Four mutually exclusive projects are being considered for a new two-mile jogging track. The life of the track is expected to be 80 years, and the sponsoring agency's MARR is 12% per year. Annual benefits to the public have been estimated by an advisory committee and are shown below. Use the IRR method to select the best jogging track. Alternative A B D Initial Cost $62,000 $52,000 $150,000 $55,000 Annual benefits $10,000 $8,000 $20,000 $9,000 IRR 16.1% 15.4%