Question

8) Duck Construction has proposed two alternatives for constructing a new bridge in Orego Based on data from recent bridge construction projects of comparable size, the estimated for each alternative are given below. Use the conventional B-C ratio method, with PW as equivalent-worth measure, to determine which alternative should be selected at an inter of14% per year. Assume a study period of50 years. Alternative II Alternative I Construction and design costs, $M$2,000,000 Annual maintenance, $/yr $2,010,000 $180,500 $160,000 $712,500 $690,000 Annual benefits, $/yr

Answer 1

Alternotive Constructhon and design cots 2 m Annual maintenance o16 m MARR Sto year L ife 〖ene eren F6 mn Annual Now of Alternative l。fw of ßenefito- pn of Costo -2 Arternotive 2 2-o' mn Construction cost - Anua maintenandeoi mn Anue enefy 47w of Al Aterna tivc 2 ニ pw of ßenefi-U)-PW of Cost

Pw of annue cost t Cot S66 Ec of A1fevnctiv 2 0 1 P/A,147,) So 32 3. 293 2 pr of Art. 1 Eauvalent unifM Cash plow far Ait, 1 _ (P/A , 14% , so , 132

NPn of At.2 for Ait.2 132 As pex Pn method/ analyi Aiternative 2 Fo e chosen over 1 i s greater than 1 rr _ ( ra tio EUCF analysi Al t ernativ 2。ho be chosen ove-/ A1 ter nctwe」