Four mutually exclusive projects are being considered for a new 2-mile jogging track. The life of the track is expected to be 90 years, and the sponsoring agency's MARR is 12% per year. Annua benefits to the public have been estimated by an advisory committee and are shown below. Use the B-C method (incrementally) to select the best jogging track. A Initial cost $60,000 Annual benefits $10,000 B-C ratio 1.39 B $140,000 $20,000 1.19 .……. Alternative Perform the incremental B-C Analysis. Fill-in the table below. (Round to two decimal places.) Alternative D Inc. B-C ratio 1.23 C $59,000 $9,500 1.34 D $54,000 $8,000 1.23 Is the alternative acceptable? Yes

Four mutually exclusive projects are being considered for a new 2-mile jogging track. The life of the track is expected to be 90 years, and the sponsoring agency's MARR is 12% per year. Annua benefits to the public have been estimated by an advisory committee and are shown below. Use the B-C method (incrementally) to select the best jogging track. A Initial cost $60,000 Annual benefits $10,000 B-C ratio 1.39 B $140,000 $20,000 1.19 .……. Alternative Perform the incremental B-C Analysis. Fill-in the table below. (Round to two decimal places.) Alternative D Inc. B-C ratio 1.23 C $59,000 $9,500 1.34 D $54,000 $8,000 1.23 Is the alternative acceptable? Yes

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Is the Benefit-cost analysis a decision-making tool for systematically developing useful information about the desirable and undesirable effects of public projects?
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