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2. (20 pts) You community decides to build a new highway bypass to reduce traffic congestion. The initial capital cost of the bypass will be

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2. (20 pts) You community decides to build a new highway bypass to reduce traffic congestion. The initial capital cost of the bypass will be $100,000,000. Annual maintenance will be $3,000,000, and periodic resurfacing will cost $15,000,000 every six years. The plan is to sell a municipal bond at 6% to fund the bridge. 2.1. (5 pts) Show your cash flow diagram: 2.2. (9 pts) What is the capitalized cost of the bypass? 2.3. (4 pts) What is the annualized cost of the bypass to the community? 2.4. (2 pts) If the community can accept $10,000,000/yr increase to its tax base, can the bypass be approved and built

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