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'sMARR is 11% per year. Annual benefits to the public have been estimated by an advisory committee and are shown below. Use the B-C method (incrementally) toselect the best jogging track.AlternativeBInitial costS145,000$64,000$57,000$50,000Annual benefits$21,000$10,500$9,000$7,000B-C ratio1.321.491.441.27Perform the incremental B-C Analysis. Fill-in the table below. (Round to two decimal places.)AlternativeInc. B-C ratioIs the alternative acceptable?D1.27Yes2.60Yes

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 agen MARR is 11% per year. Annual benefits to the public have been estimated by an advisory committee and are shown below. Use the B-C method (incremental select the best jogging track. Alternative C $57,000 D Initial cost $145,000 S64,000 $50,000 Annual benefits $21,000 $10,500 $9,000 $7,000 B-C ratio 1.32 1.49 1.44 1.27 Perform the incremental B-C Analysis. Fill-in the table below. (Round to two decimal places.) Alternative Inc. B-C ratio Is the alternative acceptable? 1.27 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 agen MARR is 11% per year. Annual benefits to the public have been estimated by an advisory committee and are shown below. Use the B-C method (incremental select the best jogging track. Alternative C $57,000 D Initial cost $145,000 S64,000 $50,000 Annual benefits $21,000 $10,500 $9,000 $7,000 B-C ratio 1.32 1.49 1.44 1.27 Perform the incremental B-C Analysis. Fill-in the table below. (Round to two decimal places.) Alternative Inc. B-C ratio Is the alternative acceptable? 1.27 Yes

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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Four mutually exclusive projects are being considered for a new 2-mile jogging track. The life of the track is expected to ing agency's MARR is 9% per year. Annual benefits to the public have been estimated by e shown below. Use the B-C method (incrementally) to select the best jogging track. Problem 10-17 (algorithmic) Q Initial cost Annual benefits B-C ratio A $50,000 $8,000 1.78 Alternative A Alternative B $145,000 $21,000 1.61 $55,000 $9,000 1.82 D $64,000 $10,500 1.82 Perform the incremental B-C Analysis. Fill-in the table below. (Round to two decimal places.) Inc. B-C ratio Is the alternative acceptable? Yes 1.78 □
Question 1 You are interested in purchasing a car from the available three options. CAR-1 CAR-2 CAR-3 First Cost 17856 23456 28678 Operating cost ($/year) Benefits ($/year) Disbenefits ($/year) Life (years) 743 589 321 435 1088 890 85 145 134 12 15 20 Use Incremental B/C analysis to determine which car is better at an interest rate of 9% per year.
Using the incremental B/C analysis (AB/C). Determine the best alternative, i=10% First cost O &M Cost/year Benefit/year Salvage value Life in years A 45,000 $4,000 $15,000 $9,000 B $25,000 $1,500 $9,500 $5,000 10 с $35,000 $3,000 $14,000 $7,000 D $15,000 $2,000 $8,000 $3,000
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The following estimates (in $1000 units) have been developed for a security system upgrade at Fairbanks International Airport, FAI. Item Cash Flow First cost, $ 13,000 AW of benefits, $ per year 3,800 FW of disbenefits, year 20, $ 6,750 M&O costs, $ per year 400 Life, years 20 Please calculate your dollar values to the nearest whole dollar. Format 0000 No commas. Please calculate your B/C ratios to 2 decimal places. Format 0.00 Treat any disbenefits as negative benefits and not additional costs. a. Calculate the modified B/C ratio (use AW) at a discount rate of 10% APR, compounded daily. b. Is the project justified? O A. No, the B/C ratio is > 1 O B. Yes, the B/C ratio > 1 Please calculate your dollar values to the nearest whole dollar. Format 0000 No commas. c. Determine the minimum/maximum first cost, FC, that is possible to render the project economically unjustified/justified. $
A local government in Virginia is considering three different alternatives for a sewage treatment plant. The type of equipment and technology needed are quite different in each case. The following summarizes the economic data for all the alternatives Alt. B 5,600,000 600,000 1,000,000 Alt. A Alt. C Equipment costs O &M costs/year Annual benefits 4,350,000 450,000 640,000 6,500,000 750,000 1,300,000 The economic life of the project is 40 years. The locality's cost of funds is 8%. Use conventional benefit-cost analysis and incremental analysis to determine which alternative should be recommended. Note that doing nothing is not an alternative.
IC OM B D Life/years X Z Y X $320,000 $45,000 $110,000 $20,000 10 W Y $540,000 $35,000 $150,000 $45,000 20 Based on the above ME alternatives and using the B/C analysis, which alternative we should select?i=10%. Z $300,000 $50,000 $80,000 $10,000 10 W $330,000 $20,000 $95,000 $30,000 20 V $250,000 $40,000 $90,000 $10,000 15
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How can we determine whether the project is acceptable or not?
A county in Tennessee is considering the following public interest project. Initial Cost $22.5M Annual Maintenance Cost $525K EUAB $3.3M Given a useful life of 12 years and an interest rate of 4%, the benefit /cost ratio is _____________________. Group of answer choices 1.01 1.13 1.51 1.67 1.48
7 A flood control project with a life of 16 years will require an investment of $55,000 and annual maintenance costs of $6,000. The project will provide no benefits for the first two years but will save $26,000 per year in flood damage starting in the third year. The appropriate MARR is 12% per year. What is the modified B-C ratio for the flood control project?