The estimated annual cash flows for a proposed municipal government project are costs of $710,000 per year, benefits of $890,000 per year, and disbenefits of $210,000 per year. Calculate the conventional B/C ratio at an interest rate of 9% per year, and determine if it is economically justified. 1.39 The project is economically not justified The B/C ratio is

The B/C ratio for a mosquito control program proposed by the Harris County Department of Health is reported to be 2.1. The person who prepared the report stated that the annual health benefits were estimated to be $400,000, and that disbenefits of $25,000 per year were used in the calculation. He also stated that the costs for chemicals, machinery, maintenance, and labor were estimated at $150,000 per year, but he forgot to list the cost for initiating the program (trucks, pumps, tanks, etc.). If the initial cost was amortized over a 10-year period at 8% per year, what is the estimated initial cost?

A consultant, after 3 months of work, reported that the modified B/C ratio for a city-owned hospital heliport project is 1.7. If the initial cost is $1 million and the annual benefits are $150,000, what is the amount of the annual M&O costs used in the calculation? The report stated that a discount rate of 6% per year and an estimated life of 30 years were used.

The following estimates (in $1000 units) have been developed for a security system upgrade at Chicago’s O’Hare Airport. (a) Calculate the conventional B/C ratio at a discount rate of 10% per year. Is the project justified? (b) Determine the minimum first cost that is possible to render the project just economically unjustified. Item Cash Flow First cost, $ 13,000 AW of benefits, $ per year 3,800 FW of disbenefits, year 20, $ 6,750 M&O costs, $ per year 400 Life, years 20

An alternative has the following cash flows: benefits = $50,000 per year; disbenefits $27,000 per year; costs $25,000 per year. The B/C ratio is closest to: 1.04 L 0.92 2.00 0.96

The conventional B/C ratio estimate of 2.1 was reported to the County Commissioners for a proposed mosquito control program.The person who prepared the report stated that the health benefits were estimated to be $400,000 per year, and that disbenefits of $25,000 per year were used in the calculation. She also stated that the costs for chemicals, machinery, maintenance, and labor were estimated at $150,000 per year. However, sheforgot to list the cost for initiating the program (trucks, pumps, tanks, etc.). If the project has a 10-year study period and an 8%-per-year discount rate, determine the estimated initial cost.

An Army Corps of Engineers project for improving navigation on the Ohio River will have an initial cost of $6,500,000 and annual maintenance of $130,000. Benefits for barges and paddle wheel touring boats are estimated at $820,000 per year. If the project is assumed to be permanent, use theconventional B/C ratio to determine if it is economically justified at 8% per year.

Two alternatives, identified as X and Y, are evaluated using the B/C method. Alternative Y has a higher total cost than X. If the B/C ratios are 1.2 and 1.0 for alternatives X and Y, respectively, which alternative should be selected? Why

The modified B/C ratio for a city-owned hospital heliport project is 1.7. The initial cost is $0.975 million, annual benefits are $150,000, and the estimated life is 29 years. What is the amount of the annual M&O costs used in the calculation at a discount rate of 6% per year?  The annual M&O costs is $