Pearson eText for Engineering Economy -- Instant Access (Pearson+)
17th Edition
ISBN: 9780137533138
Author: William Sullivan, Elin Wicks
Publisher: PEARSON+
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Chapter 10, Problem 7P
To determine
Calculate the time period.
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Juba city council is considering to construct a sewage management system, the construction of this system will take 3 years before commissioning. the initial capital outlay is estimated to be $10m after commissioning, the juba city council will incur an annual operation and maintenance cost in the amount of $500,000. the sewage management system will generate an annual benefit of $ 2.5m.
the sewage management system will have useful life of 27 years. the city council use 5% discount rate to appraise public project.
Required.
1- compute the present value of the cost and benefits?
2-perform cost benefit analysis to determine whether the project should be undertaken by the City council?
3-Assume you are consulted on this project, advice the city council on how to governed the project.
4- In addition to monetary conditions, what are the other factors to be considered in deciding whether or not the project would be taken?
A city government is considering two types of town-dump sanitary systems. Design A requires an initial outlay of $354,000 with annual operating and maintenance costs of $45,000 for the next 16 years; design B calls for an investment of $277,000 with annual operating and maintenance costs of $67,000 per
year for the next 16 years. Fee collections from the residents would again be $90,000 per year. The interest rate is 11%, and no salvage value is associated with either system.
Click the icon to view the interest factors for discrete compounding when i= 11% per year.
(a) Using the benefit-cost ratio BC(), which system should be selected?
The PIA - B is 2.11. (Round to two decimal places.)
Which system should be selected? Choose the correct answer below.
Design B
Design A
(b) If a new design (design C), which requires an initial outlay of $335,500 and annual operating and maintenance costs of $56,000, is proposed, would your answer in part (a) change?
The Pl()- cis 4.39. (Round to two…
The city of Oakmont is interested in developing some lake front property into a sports park (picnic facilities, boat docks, swimming area, etc.). A consultant has estimated that the city would need to invest $3 million in this project. In return, the developed property would return $500,000 per year to the city through increased tax revenues and recreational benefits to the public. Whatwould the life of this project need to be in order to be cost-beneficial to the city? The interest rate on municipal bonds is 6% per year.
Chapter 10 Solutions
Pearson eText for Engineering Economy -- Instant Access (Pearson+)
Ch. 10 - Prob. 1PCh. 10 - Prob. 2PCh. 10 - Prob. 3PCh. 10 - A retrofitted space-heating system is being...Ch. 10 - Prob. 5PCh. 10 - Prob. 6PCh. 10 - Prob. 7PCh. 10 - Prob. 8PCh. 10 - Prob. 9PCh. 10 - Prob. 10P
Ch. 10 - Prob. 11PCh. 10 - Prob. 12PCh. 10 - Prob. 13PCh. 10 - Prob. 14PCh. 10 - Prob. 15PCh. 10 - Prob. 16PCh. 10 - Four mutually exclusive projects are being...Ch. 10 - Two municipal cell tower designs are being...Ch. 10 - Prob. 19PCh. 10 - Prob. 20PCh. 10 - Prob. 21PCh. 10 - Prob. 22PCh. 10 - You have been requested to recommend one of the...Ch. 10 - Prob. 24PCh. 10 - Prob. 25PCh. 10 - Prob. 26FECh. 10 - Prob. 27FECh. 10 - Prob. 28FECh. 10 - Prob. 29FECh. 10 - Prob. 30FECh. 10 - Prob. 31FE
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