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1. This project must fund the construction of an on/off-interchange from an adjacent highway, a 2-mile length of 4-lane divided roadway, and a bridge that will cross a 500-foot wide river. The entire project is estimated to require 2 years to complete following planning & design.

a. The interchange is projected to cost $50 million. It will need to begin construction in 18 months. Rights-of-way acquisition, surveying, and permitting have already been completed and paid for by the program. There will be 2 additional project phases: 1) planning & design, 2) construction. Each will require payment at the end of the phase. The projected cost of the 1st phase of the project is $2.5 million. The 1st phase is expected to need the entire 18 months prior to the start of construction and must be completed before construction can begin. The 2nd phase is projected to cost the remaining $47.5 million. It is expected to be completed at the end of the 2-year period following planning & design. Assuming a discount rate of 4.25% and monthly compounding, what amount will need to be funded today to meet the complete project’s funding requirements on the payment due dates

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EBK CONTEMPORARY FINANCIAL MANAGEMENT
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ISBN: 9781337514835
Author: MOYER
Publisher: CENGAGE LEARNING - CONSIGNMENT
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