MindTap Engineering for Garber/Hoel's Traffic and Highway Engineering, 5th Edition, [Instant Access], 1 term (6 months)
5th Edition
ISBN: 9781305581159
Author: Nicholas J. Garber; Lester A. Hoel
Publisher: Cengage Learning US
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Chapter 13, Problem 15P
To determine
The preferred alternative using equivalent annual cost analysis.
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C) Two alternatives have been proposed to construct a new road project to improve capacity and
safety. The table below explains each alternative's costs: the initial construction costs, annual
operating and maintenance costs after the first year, and resurface of road costs. Assume that the
annual interest rate is 5%. Determine the present worth for each alternative, then choose the
preferred alternative based on the economic criteria. by present worth
Alternative
The initial construction costs
The annual operating and maintenance costs
The resurface costs
Service life (years)
$4.000.000
$3.900
$850,000
(Every five years)
14
$3,800,000
$4,100
$800.000
(Every four years)
Dunkin City wants to build a new bypass between two major roads that will cut travel time for
commuters. The road will cost $14,000,000 and save 17,500 people $100/yr in gas. The road will
need to be resurfaced every year at a cost of $7,500. The road is expected to be used for 20 years.
Determine if Dunkin City should build the road using B/C analysis. The cost of money is 8%.
The Department of Traffic is considering three improvement plans for a heavily traveled intersection within the city. The intersection improvement is expected to achieve three goals: improve travel speeds, increase safety, and reduce operating expenses for motorists. The annual dollar value of savings compared with existing conditions for each criterion as well as additional construction and maintenancecosts is shown in the table below. If the economic life of the road is considered to be 60 years and the discount rate is 3.5%, which alternative should be selected? Solve the problem using the four methods for economic analysis.
Chapter 13 Solutions
MindTap Engineering for Garber/Hoel's Traffic and Highway Engineering, 5th Edition, [Instant Access], 1 term (6 months)
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- The Department of Traffic is considering three improvement plans for a heavily traveled road within the city. The road improvement is expected to achieve three goals: improve travel speeds, increase safety, and reduce operating expenses for motorists. The annual dollar value of savings compared with existing conditions for each criterion and additional construction and maintenance costs is shown in Table 1. If the economic life of the road is considered to be 53 years and the discount rate is 4%, which alternative should be selected? Evaluate the two proposals based on economic evaluation criteria using the Net Present Worth (NPW) and benefit-cost ratio (BCR) methods for economic analysis.arrow_forwardThree designs have been proposed to improve traffic flow at a major intersection in a heavily traveled suburban area. The first alternative involves improved traffic signaling. The second alternative includes traffic-signal improvements and intersection widening for exclusive left turns. The third alternative includes extensive reconstruction, including a grade separation structure. The construction costs, as well as annual maintenance and user costs, are listed in the following table for each alternative. Determine which alternative is preferred based on economic criteria if the analysis period is 20 years and the annual interest rate is 15%. Show that the result is the same using the present worth, equivalent annual cost, benefit–cost ratio, and rate-of-return methods.arrow_forwardTwo alternatives are under consideration for maintenance of a bridge. Select the mostcost-effective alternative using present worth analysis. Assume an interest rate of10% per year and a design life of 50 years for each alternative.Alternative A consists of annual maintenance costs of $5,000 per year for the designlife except for:Year 20, in which bridge deck repairs will cost $20,000Year 30, in which a deck overlay and structural repairs will cost $105,000Alternative B consists of annual maintenance costs of $3,000 per year for the designlife except for:Year 20, in which bridge deck repairs will cost $35,000Year 30, in which a deck overlay and structural repairs will cost $85,000arrow_forward
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- а. The Department of Traffic is considering three improvement plans for a heavily traveled road within the city. The road improvement is expected to achieve three goals: improve travel speeds, increase safety, and reduce operating expenses for motorists. The annual dollar value of savings compared with existing conditions for each criterion and additional construction and maintenance costs is shown in Table 1. If the economic life of the road is considered to be. Table 1: Cost and Benefits for Improvement Plans concerning Existing Conditions Alternative Construction Annual Annual Annual Annual Cost ($) Saving Cost Travel Time Operation Maintenance in Benefits($) Saving($) Cost($) Accidents($) 185.000 5000 3000 300 1500 220,000 5000 6500 500 2500 II 310,000 7000 6000 2800 3000arrow_forwardA bridge has been constructed between the mainland and an island. The total cost (excluding tolls) to travel across the bridge is expressed as C- 50 + 0.5V, where V is the number of veh/hr and Cis the cost/vehicle in cents. The demand for travel across the bridge is V- 2500 - 10C. (a) Determine the volume of traffic across the bridge. (b) If a toll of 25 cents is added, what is the volume across the bridge? What volume would be expected with a 50 cent increase? 155 (c) A tollbooth is to be added, thus reducing the travel time to cross the bridge. The new cost function is C- 50 + 0.2V. Determine the volume of traffic that would cross the bridge. (d) Determine the toll to yield the highest revenue for demand and supply function in part (a), and the associated demand and revenuearrow_forwardA city engineer has estimated the annual toll revenues from a proposed highway construction project over 20 years as follows: An = ($2,000,000)(n)(l.06)n-1 n = 1.2 .... ,20.To determine the amount of debt financing through bonds, the engineer was asked to present the estimated total present value of toll revenue at an interest rate of 6%. Assuming annual compounding, find the present value of the estimated toll revenue.arrow_forward
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