If benefits are $10,000 per year forever starting in year 1, and costs are $50,000 at time zero and $50,000 at the end of year 2, the B/C ratio at i = 10% per year is closest to: (a) 0.93 (b) 1.10 (c) 1.24 (d) 1.73

One of two alternatives will be selected to reduce flood damage in a rural community in central Arizona. The estimates associated with each alternative are available. Use B/C analysis at a discount rate of 7% per year over a 20-year study period to determine which alternative should be selected. For analysis purposes only, assume that the benefits of reduced flood damage are available in years 3, 13, and 18 of the study period. Retention Pond Channel Initial Cost, $ 960,000 2,900,000 Annual Maintenance , $/Year 92,000 30,000 Reduced Flood Damage, $ 200,000 550,000 The AB/C ratio is The alternative that should be selected is the retention pond

One of two alternatives will be selected to reduce flood damage in a rural community in central Arizona. The estimates associated with each alternative are available. Use B/C analysis at a discount rate of 8% per year over a 20-year study period to determine which alternative should be selected. For analysis purposes only, assume that the benefits of reduced flood damage are available in years 2, 12, and 18 of the study period. Retention Pond Channel Initial Cost, $ 880,000 3,000,000 Annual Maintenance , $/Year 92,000 30,000 Reduced Flood Damage, $ 200,000 675,000 The AB/C ratio is The alternative that should be selected is the (Click to select) v

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: (a) 0.92 (b) 0.96 (c) 1.04 (d) 2.00

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

From the following data, use the conventional B/C ratio for a project that has a 20-year life to determine if it is economically justified. Use an interest rate of 8% per year. To the People Annual benefits = $105,000 per year Annual disbenefits = $10,000 per year The B/C ratio is The project is_ To the Government First cost = $550,000 Annual cost = $29,000 per year Annual savings: $30,000 per year

The estimated first cost of a permanent national monument is $2 million with annual benefits and disbenefits estimated at $360,000 and $42,000, respectively. The B/C ratio at 6% per year is closest to: (a) 0.16 (b) 0.88 (c) 1.73 (d) 2.65

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.

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