If alternatives' useful lives are different, B/C ratio analysis should preferably be based on: Select one: a. ROR b. annual worth c. future worth d. present worth
Q: When a B/C analysis is conducted, the benefits and costs: (a) Must be expressed in terms of their…
A: Answer - B/C analysis - It is used to evaluate the strength and weakness different options to get…
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Q: The B/C ratio is The project is economically not justified
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Q: Consider the following assumptions, field size 640 acres, non-cropped area 5 acres, 2600' total…
A: Answer - Need to find- Statment is true of false Given in the question-
Q: The PW of five independent projects have been calculated at an MARR of 12% per year. Select the best…
A: Given MARR = 12% Total number of projects = 5
Q: An alternative has the following cash flows: Benefits of $30,000 per year, Disbenefits of $14,000…
A: The benefit-cost ratio is inversely related to the present value of cost. It means as the present…
Q: The "do-nothing" alternative refers to a situation when all of the alternatives being considered is…
A: The "do nothing" alternative refers to a situation when all of the alternatives being considered is…
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A: (a) Time period is denoted by n and interest rate is denoted by i. Benefit cost ratio (BC) for…
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A: Table 1 shows the attributes and its importance.
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A: First, find the present worth of benefits: In year zero benefit = $45000 In year 5 benefit = $30000…
Q: A county will invest $4,100,000 to clean up a chemical spill that occurred following a natural…
A: Benefit-Cost Analysis (BCA) — likewise called CBA or cost-benefit analysis beyond North America — is…
Q: A government project has the following estimates: Annual Benefits P500,000 Annual Disbenefits…
A: Benefit cost ratio is the ratio of net benefits to net cost. B/C ratio = Total benefits / Total…
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Q: Which of the following DOES NOT agree with the definition/description of B/C ratio? A. B/C ratio can…
A: The benefit-Cost ratio is used by the government and private organisations to check the viability…
Q: A consultant, after 3 months of work, reported that the modified B/C ratio for a city-owned hospital…
A: Let annual M&O cost be M. Then Modified B/C ratio = (PW of annual benefit - PW of annual M&O…
Q: An Army Corps of Engineers project for improving navigation on the Ohio River will have an initial…
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Q: In order to improve a certain number of public parks in the city of Los Angeles, a proposed 20 year…
A: Given; First cost= $200000 M&O costs= $25000 Number of new people use the improved parks at an…
Q: From the PW, AW, and FW values shown, the conventional B/C ratio is closest to: Ка) 1. 27 (b) 1. 33…
A: B/C analysis i.e. benefit-cost analysis gives the ratio of benefits and costs in the same period. It…
Q: 1. If all individual B/C ratios of MEAS are less than 1.00, then the preferred option is to “Do…
A: B/C ratio is used for benefit and cost analysis for the given projects. Under long life span…
Q: One of two alternatives will be selected to reduce flood damage in a rural community in central…
A: In a cost-benefit analysis, a benefit-cost ratio (BCR) is a ratio that summarises the overall…
Q: One of two alternatives will be selected to reduce flood damage in a rural community in central…
A: Given the discount rate = 7% Time period = 20 years
Q: Two alternatives, identified as X and Y, are evaluated using the B/C method. Alternative Y has a…
A: The cost benefit ratio is used to analyze the costs and benefits of a proposed project.
Q: Which among these pairs would provide a good market feasibility judgment on a given project? a.…
A: Good market feasibility of a given project is very essential for any project to be successful in the…
Q: Furniture, Inc., sells lamps for $30. The unit variable cost per lamp is $22. Fixed costs total…
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Q: In the Systematic Economic Analysis Technique (SEAT), Step 5 is Compare the alternatives by an…
A: The inductive process can be used to precisely explore an idea or hypothesis to see if it is…
Q: Which is the most efficient analysis method we can use for determining project acceptability on an…
A: Present worth analysis is the most efficient analysis method that we can use for determining project…
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A: Ratings given are 3, 7, 2, 10 Weights given: 0.4, 0.3, 0.2, 0.1
Q: Comparison of five mutually exclusive alternatives is shown. One must be accepted. According to the…
A: * SOLUTION :- The OPTION B ( alternative D ) is correct answer. * Explanation :-
Q: The cash flows associated with a public-school building repair project are as follows: costs…
A: Given: Benefit=$600,000 Disbenefits=$90000 Costs=$550,000
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A: The length of maximum payback period depends on the type of project and the financial situation of…
Q: The estimated annual cash flows for a proposed municipal government project are costs of $710,000…
A: The case is of "Forever" basis, so Conventional B/C ratio and economically justification of project…
Q: Four independent public sector projects A, B, C and D were evaluated using the B/C ratio. The…
A: Benefit cost ratio (BC ratio) is the ratio of present value of Annual benefits divided by Present…
Q: Given the data for two alternatives, choose the better alternative using the B/C ratio analysis.…
A: An obstacle rate, which is otherwise called the minimum acceptable rate of return, is the minimum…
Q: Define the term Net Present Worth in the present worth analysis?
A: Net present worth (NPW) or net present value (NPV) is defined as present worth of the total cash…
Q: Which of the following are limitations of the payback period analysis? Select one: a. can lead to…
A: C Time value of money is ignored The payback period refers to the amount of time require at the…
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A: We can plot these cash flows and solve for PV using 12% as the rate of discount as per table below.
Q: MKBIC Systems is evaluating four projects A, B, C and D that have risks associated with the…
A: To find the best project we will add all the events of prob. Project EUAW = EUAW * Prob. Project A…
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Q: A proposed bridge considered at the cost of Php 20 million. It is expected that the bridge will last…
A: * SOLUTION :- Given that , annual benifit = 9000000 Capitalized first cost = 20000000 Annual…
Q: An alternative has the following cash flows: benefits = $50,000 per year; disbenefits = $27,000 per…
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Q: In order for a higher-cost alternative to be attractive, the incremental benefit-cost ratio must be…
A: At the marketplace, alternatives refers to the availability of substitutes of a specfiic good or…
Q: The State Legislative Budget Board approved adding 4000 surveillance cameras along the 800-mile…
A: The number of cameras (N) is 4,000. Cost per camera (C) is $300. Additional cost (AD) is $3,200,000.…
Q: Calculate the B/C ratio for the following cash flow estimates at a discount rate of 10% per year. Is…
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Q: One of two alternatives will be selected to reduce flood damage in a rural community in central…
A: Find: 1) The incremental benefit cost ratio. 2) Alternative that should be selected. Solution:…
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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. $4. Incremental ROR and B/C methods require the LCM of the two alternatives being compared. Select one: True FalseGiven the data for two alternatives, choose the better alternative using the B/C ratio analysis. MARR = 8% (Hint: If using EUAW, change each first cost to annual fırst then do incremental. If using PW, match the cash flows (rebuy Bottom) before subtracting.) Alternative Bottom Тop First Cost $100,000 $140.000 Operating Costs/Yr 50,000 100,000 60,000 Benefits/Yr 120,000 Maintenance/Yr 30,000 25,000 Life in years 10
- In decision making process, the most important role of engineering economist is to define feasible alternatives. Select one: True FalseAlternative Annualized first cost. $/year Annual M&O cost. $/year Annual benefits, $/year Annual disbenefits, $/year Life, years Multiple Choice O O fund both X and Y fund neither fund Y fund X 60,000 90.000 45,000 35,000 110.000 150.000 20,000 45,000 Show Transcribed Text for the two independent projects shown determine which if any should be funded i=10% per year using B/C ratio method.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
- Locations under consideration for a border patrol station have their costs estimated by the federal government. Use the B/C ratio method at an interest rate of 9% per year to determine which location to select, if any. Location Initial Cost, $ Annual Cost, $ per Year Disbenefits, $ per Year Life, Years The AB/C ratio is North N 2,160,000 480,000 70,000 00 South S 2,900,000 445,000 57,000 00(b) A local government has funded a public project with the following data. Initial investments Annual benefits Annual operating and maintenance (O&M) costs Salvage value Project life Interest rate $5,000,000 $1,500,000 $300,000 $500,000 8 years 6% (i) Determine whether the project is a good investment by using conventional B-C (Benefit-Cost) ratio based on AW (Annual Worth) method. (ii) Determine whether the project is a good investment by using modified B-C (Benefit- Cost) ratio based on PW (Present Worth) method.Evaluate the two alternatives A and B and decide the economic justified alternative using: Present worth method Annual worth method Future worth method I.R.R method E.R.R Method E.R.R.R method M.A.R.R = 15% the details of alternatives are shown in the table below Alternatives A Investments $6,000 $7,500 Useful life (years) 10 Annual disbursements $2,500 $3,500 Annual revenues $4,500 $6,000 Salvage values $500 $1,000
- Comparison of five mutually exclusive alternatives is shown. One must be accepted. According to the B/C ratio, which alternative should be selected (costs increase from A to E). AB/C Comparison Ratio A versus B 0.75 B versus C 1.4 C versus D 1.3 A versus C 1.1 A versus D 0.2 B versus D 1.9 C versus E 1.2 D versus E 0.9 O a. B O b. D Ос. А O d. E O e. CA public works project has an initial cost of P1 000 000, benefits with a present worth of P 1 500 000, and disbenefits worth of P 400 000. What is the benefit cost ratio? Answer:The two alternatives shown are under consideration for improving security at a facility. Determine which one should be selected, if any, based on a B/C analysis. Consider an interest rate of 7% per year and a 10-year study period. Additional information is provided in Table Q 6(b). Page 4 of 5 Table Q 6(b) Alternative 1: Extra Cameras | Alternative 2: New Sensors First cost, $ Annual O&M cost, $ 38000 87000 49000 64000 Annual benefits, $ Annual disbenefits, $ 110000 160000 26000