The department of transport will collect 5$ toll from each vehicle to recover the cost of a newly- built highway. In the first year (end of year 1), 10,000 cars are expected to use the highway followed by 4% annual increase in traffic due to the expansion of the city. Determine the equivalent present worth of this project over 20 years' time and at an interest rate of 8%?
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- Improvement to the runways at a regional airport are expected to cost $2million. To pay for the improvements, the airport authority will increase the landing fees of commercial planes. If the airport wants to recover its investment in 4 years, how much money must be generated from the increased fees each year at an interest rate of 8% per year compounded semiannually?A municipality decides to purchase a small collection truck that has an expected life of 10 years of Rs. 590,000. Cost of truck is to be borrowed from the local bank and to be paid back in 10 annual payments. Determine the annual instalments on this capital expense if the interest rate is 6.125 %If you are a city engineer and you know that you will need $25 million in 3 years to' replace toll booths on a toll road in the city. Traffic on the road is estimated to be 20 million vehicles per year. How much per vehicle should the toll be to cover the cost of the toll booth replacement project? Interest is 10%. (assume that the toll receipts are received at the end of each year in a lump sum.) A. $0.38 per vehicle В. $0.88 per vehicle С. $0.28 per vehicle
- A state highway department is planning the construction of a toll road. Construction cost will be $300 million (at period = year 0). Annual maintenance is estimated to be $1 million every year from year 1 and in perpetuity. In addition, a major resurfacing will have to be carried out at the cost of $10 million every 10 years in perpetuity. MARR is 10%. It is estimated that 5 million vehicles per year will use the toll road starting in year 1 and in perpetuity, and each vehicle will pay a constant toll $T. Show the (indicative) cash flow diagram for this project. Use AW analysis to determine what breakeven constant toll $T should be charged to each vehicle to make sure benefits will be economically equivalent to costs.A constructed bridge requires no upkeep until the end of 2 years when P60,000 will be needed for repairs. After this P90,000 will be needed for repairs at the end of each year for the next 5 years, then P190,600 at the end of each year for the next 5 years. If money is worth 13% compounded annually, what was the equivalent uniform annual cost for the 12-year period? Show complete solution and formula used. Provide cash flow diagram. Write the solution in a paper. Thank you!Maintenance costs at the Woodland Waterpark are predicted to be $1,400 in the first year and increase by $800 each year after that. The park will operate for 9 years. What is the future value of the maintenance costs paid by the park during its operation?
- The Highway Department expects the cost of maintenance for a piece of heavy construction equipment to be $5000 in year 1, to be $5500 in year 2, and to increase annually by $500 through year 10. At an interest rate of 10% per year, determine the present worth (in $, roundoff to 2 decimal places) of the maintenance costs.$100,000 of annual repair is needed to maintain a tunnel. if the interest rate earned on funds held by the city is 7% per year, What is the amount needed today to maintain the tunnel indefinitely (i.e. perpetual basis)?A constructed bridge requires no upkeep until the end of 2 years when P60,000 will be needed for repairs. After this P90,000 will be needed for repairs at the end of each year for the next 5 years, then P110, 900 at the end of each year for the next 5 years. If money is worth 13% compounded annually, what was the equivalent uniform annual cost for the 12-year period? Include cashflow diagram.
- The Highway Department expects the cost of maintenance for a piece of heavy construction equipment to be $5000 in year 1, to be $5500 in year 2, and to increase annually by $500 through year 10. At an interest rate of 10% per year, determine the present worth of 10 years of maintenance costs.A certain government funded city flood control system has an initial investment cost of $500,000. Cost of materials, maintenance, electric power and other operating costs are expected to total $10,000 per year beginning from the first year until the infinite future. Major repairs and rehabilitations will occur every 5 years at a cost of $100,000. If the interest rate is 10% per year, what is the equivalent capitalized cost of this project?The construction cost of a new bridge is $2M. Annual upkeep is estimated to be $35K. In addition to annual upkeep, major maintenance work is anticipated every 9 years at a cost of $250K per occurrence. The town governments MARR is 9%. Find the capitalized cost ( to the nearest dollar).