Argentina is considering the construction of a bridge across the "Rio de la Plata" river to

connect its northern coast to the southern coast of Uruguay. If this bridge is constructed,

it will reduce the travel time from Buenos Aires $($Argentina$)$ to Sao Paulo $($Brazil$)$ by

over $10$ hours and has the potential to significantly improve the flow of manufactured

goods between the two countries. The new bridge, which will be the longest bridge in the

world and span over $50$ miles, will cost $$630$ million. The bridge will require annual

maintenance of $$10$ million for repairs and upgrades and is estimated to last $80$ years. It

is estimated that $550,000$ vehicles will use the bridge during the first year of operation

and an additional $50,000$ vehicles per year until the $10$th year. The annual traffic for the

remainder of the life will be $1,000,000$ vehicles$/$year$.$ These data are based on a toll

charge of $$\frac{80}{v}$ehicle. The Argentinian government requires a minimum rate of return of

$15\%($MARR$)$ in order to proceed with the project.

a$)$ Calculate NPV$,$ IRR, and the payback period. What would you advise the

Argentinian government based on the NPV and IRR of this project?

Cashflow Diagram $(20$ pts$.)$

Calculations and answer NPV$,$ IRR, and PB $(20$ pts$.)$

b$)$ Would your recommendation change if Argentina could borrow up to $70\%$ of the

cost $($ $$441$ million$)$ at a $4\%$ interest rate from the World Bank $($paid in annual

payments over a $50-$year period$)?$

Cashflow Diagram $(20$ pts$.)$

Calculations and answer NPV$,$ IRR, and PB $(20$ pts$.)$

c$)$ What other considerations exist in deciding whether to construct the bridge? No excel needed, need all calculations and cash flow diagrams handwritten. Thanks