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5. (5 pts) A city is looking at building a bridge over a canal. Its estimated cost is $250K. The benefits to the city's population
5. (5 pts) A city is looking at building a bridge over a canal. Its estimated cost is $250K. The benefits to the city's population through reduced congestion and less wear and tear on their automobiles is estimated at 25K/year. Businesses in the vicinity of the new bridge are estimated to lose S60K in profits when construction starts (yr 0) due to reduced customer access. Once the bridge is finished in a year, profits are expected to return to previous levels. The bridge is expected to have a 50 year life and cost $50K to tear down then (negative salvage cost). Annual O&M is $10 . The city uses the conventional B/C ratio and a 5 % MARR to evaluate its projects should the city construct the bridge
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