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(5) To strengthen its climate resilience, a city is considering several mutually exclusive inland flood control project and would like to conduct an incremental
(5) To strengthen its climate resilience, a city is considering several mutually exclusive inland flood control project and would like to conduct an incremental benefit/cost anlaysis to identify the best alternative. Assume you have been asked to determine the best project from among the following four alternatives. All the values are in 1000s and the interest rate is 8%. Which alternative would you recommend? Use incremental benefit/cost analysis to determine the best alternative and use another analytical tool of your choice to check your answer. Show all your work. You may use a spreadsheet for your analysis. (10 points) Alternatives Estimated Annual Capital Cost Annual Estimated ($) Maintenance Service Life User Costs Costs (years) ($/year) ($/year) Do-Nothing 2,200 75 10 1 2,000 3,000 30 10 10 2 1,400 4,000 35 15 3 1,300 6,000 40 20 20 4 1,000 9,000 50 25 25
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