Conventional B/C ratio is used as it is written in the question below:
Project 1:
AW of net costs = 128(A/P, 12%, 5) + 60
= 128(0.2774) + 60
= 35.51 + 60
= $95.51
AW of net benefits = 60 - 10 = $50
B/C ratio = AW of net benefits / AW of net costs
= $50 / $95.51
= 0.52
Project 2:
AW of net costs = 160(A/P, 12%, 6) + 62
= 160(0.2432) + 62
= 38.91 + 62
= $100.91
AW of net benefits = 69 - 15 = $54
B/C ratio = AW of net benefits / AW of net costs
= $54 / $100.91
= 0.53
Project 3:
AW of net costs = 340(A/P, 12%, 10) + 50
= 340(0.1770) + 50
= 60.18 + 50
= $110.18
AW of net benefits = 83 - 20 = $63
B/C ratio = AW of net benefits / AW of net costs
= $63 / $110.18
= 0.57
Fimal selection = Project 3
disbenefits every year with a life of 5 years. Project 2 costs E initially, cost Fevery...
4. Project 1 costs A initially, costs B every year, generates C benefits every year and D disbenefits every year with a life of 5 years. Project 2 costs E initially, cost Fevery year, generates G benefits every year and H disbenefits every year with a life of 6 years. Project 3 costs I initially, costs) every year, generates K benefits every year and L disbenefits every year with a life of 10 years. Use an annual rate of R...
4. Project 1 costs A initially, costs B every year, generates C benefits every year and D disbenefits every year with a life of 5 years. Project 2 costs e initially, cost F every year, generates G benefits every year and H disbenefits every year with a life of 6 years. Project 3 costs I initially, costs J every year, generates K benefits every year and L disbenefits every year with a life of 10 years. Use an annual rate...
Final Selection 4. Project 1 costs A initially, costs B every year, generates C benefits every year and D disbenefits every year with a life of 5 years. Project 2 costs E initially, cost Fevery year, generates G benefits every year and H disbenefits every year with a life of 6 years. Project 3 costs: initially, costs I every year, generates K benefits every year and L disbenefits every year with a life of 10 years. Use an annual rate...
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Consider the following two projects Project 1: High rise residential building project Project 2: Low rize building First Cost, $ 320,000 540,000 M&O Cost, $/year 45,000 35,000 Benefits, $/year 110,000 150,000 Disbenefits, $/year 20,000 45,000 Life, years 10 20 - A. B. C. D. E. F. G. H. For project 1, the Benefits/Cost ratio is nearest to - ...
The estimated annual cash flows for a proposed municipal government project are costs of $730,000 per year, benefits of $890,000 per year, and disbenefits of $160,000 per year. Calculate the conventional B/C ratio at an interest rate of 8% per year, and determine if it is economically justified. The B/C ratio is . The project is economically (Click to select)justifiednot justified .
Problem 09.010 Benefit/Cost Analysis of a Single Project The estimated annual cash flows for a proposed municipal government project are costs of $710,000 per year, benefits of $910,000 per year, and disbenefits of $160,000 per year. Calculate the conventional B/C ratio at an interest rate of 12% per year, and determine if it is economically justified. The B/C ratio is The project is economically (Click to select) A
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