The State Highway Department is considering a bypass loop that is expected to save motorists $820,000 per
Question:
The State Highway Department is considering a bypass loop that is expected to save motorists $820,000 per year in gasoline and other automobilerelated expenses. However, local businesses will experience revenue losses estimated to be $135,000 each year. The cost of the loop will be $9,000,000.
(a) Calculate the conventional B/C ratio using an interest rate of 6% per year and a 20-year project period.
(b) Calculate the conventional B/C ratio without considering the disbenefits. Is the project economically justified with and without considering the revenue losses?
(c) Develop the single-cell spreadsheet functions that will answer the two questions above.
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Related Book For
Question Posted: