Assume a 20-year planning horizon and an interest rate of 10%. Which projects would be considered for funding in (a) and (b)? Refer to photo for additional information.

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DS8 Population Growth of Orlando and Surrounding Counties Results in Traffic Congestion Fast growth in the population of the city of Orlando and surrounding counties, Orange County in particular, has resulted in insurmountable traffic congestion. The county has few places to turn for extra money for road improvements except to new taxes. County officials have said that the money they receive from current taxes is insufficient to widen over-crowded roads, improve roads that donTMt meet modern standards, and pave dirt roads. State residents now pay 12 cents in taxes on every gallon of gas. Four cents of that goes to the federal government, 4 cents to the state, 3 cents to the county in which the tax is collected, and I cent to the cities. The county commissioner has suggested that the county get the money by tacking an extra penny-a-gallon tax onto gasoline, bringing the total federal and state gas tax to 13 cents a gallon. This would add about $2.6 million a year to the road-construction budget. The extra money would have a significant impact. With the additional revenue, the county could sell a $24 million bond issue. It would then have the option of spreading that amount among many smaller projects or concentrating on a major project. Assuming that voters would approve a higher gas tax, the county engineers were asked to prepare a priority list outlining which roads would be improved with the extra money. The road engineers also computed the possible public benefits associated with each road-construction project; they accounted for possible reduction in travel time, a reduction in the accident rate, land appreciation, and savings in operating costs of vehicles. District 1 II Project 24th Street Holden Avenue Forest City Road Fairbanks Avenue Oak Ridge Road University Blvd Hiawassee Road Lake Avenue Apopka-Ocoee Road Kaley Avenue Apoka-Vineland Rd Washington Street Mercy Drive Apopka Road Old Dixie Highway Old Apopka Read Type of Construction Improvement Cost Four-lane 5980,000 Four-lanc 3,500,000 Four-lane 2.800,000 Four-lane 1.400,000 Realign 2,380,000 Four-lane 5,040,000 Four-lane 2,520,000 Four-lane 4.900.000 Realign 1,365.000 Four-lane 2.800.000 Two-lane 1.170,000 Four-lane 1.120,000 Four-lane 2.800,000 Reconstruct 1,690,000 Widen 975,000 Widen 1.462,500 Annual O&M $9.800 35,000 28.000 14.000 47.600 100.800 50,400 98.000 20,475 56.000 17.550 16.800 56,000 33.800 15.900 29.250 Annual Benefits $313.600 850,000 672.000 490,000 523,600 1,310,400 831.600 1,021,000 245,700 980,000 292,000 358,400 980,000 507.000 273,000 424.200 III IV Assume a 20-year planning horizon and an interest rate of 10%. Which projects would be considered for funding in (a) and (b)? (a) Due to political pressure, each district will have the same amount of funding, say $6 million. (b) The funding will be based on tourist traffic volumes. Districts I and II combined will get $15 million, and Districts III and IV combined will get $9 million. It is desirable to have at least one four-lane project from each district