The project is to construct a lateral canal that will provide irrigation for 150 ha production area along thericefields of a town| and it is being considered by the municipality. The locality has two (wet and dry)croppings. A one (1) ha ricefarm yields 90 çavans for rainfed areas. The following costs have beenidentified.Land:800 meters long x 6 meters parcel of landat Php 950.00 per ha4,500,000.00500,000.00250,000.00Construction:Annual O&M (government):Annual O&M (farmer irrigators):Rental receipts from irrigators:17 çav/haConvenience to farmers:500,000.00Yield increase:22%Neglecting other factors associated with production yield increase, determine the B/C ratio of the projectwith a MARR of 10% per year if the project is to be used for 25 years. Is the project acceptable?

Given information Project provides irrigation=150 ha Land cost=950 per ha Construction cost=4500000…

The project is to construct a lateral canal that will provide irrigation for 150 ha production area along the ricefields of a town and it is being considered by the municipality. The locality has two (wet and dry) croppings. A one (1) ha ricefarm yields 90 cavans for rainfed areas. The following costs have been identified. 800 meters long x 6 meters parcel of land at Php 950.00 per ha Land: Construction: 4,500,000.00 500,000.00 250,000.00 17 cav/ha 500,000.00 22% Annual O&M (government): Annual O&M (farmer irrigators): Rental receipts from irrigators: Convenience to farmers: Yield increase: Neglecting other factors associated with production yield increase, determine the B/C ratio of the project with a MARR of 10% per year if the project is to be used for 25 years. Is the project acceptable?

The project is to construct a lateral canal that will provide irrigation for 150 ha production area along the ricefields of a town and it is being considered by the municipality. The locality has two (wet and dry) croppings. A one (1) ha ricefarm yields 90 cavans for rainfed areas. The following costs have been identified. 800 meters long x 6 meters parcel of land at Php 950.00 per ha Land: Construction: 4,500,000.00 500,000.00 250,000.00 17 cav/ha 500,000.00 22% Annual O&M (government): Annual O&M (farmer irrigators): Rental receipts from irrigators: Convenience to farmers: Yield increase: Neglecting other factors associated with production yield increase, determine the B/C ratio of the project with a MARR of 10% per year if the project is to be used for 25 years. Is the project acceptable?

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter17: Long-term Investment Analysis

Section: Chapter Questions

Problem 10E

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