Challenge 1 (39 Points) You are trying to decide whether or not to bid on a construction contract for a new bridge. You think that e will take 30 months to build, with construction costs of $2 million per month. You expect tolls to be $10 million per year once the bridge opens, and you expect toll collection and maintenance costs to be $1 million per year. Your MARR is 15%)year. To bid on the project, you specify the price that you are willing to pay to the state (in cash, at time 0) for the right to build the bridge and operate it for a period of 30 years. At the end of 30 years, the ownership and operation of the bridge revert to the state Question 1.a. (15 Points) You can obtain a construction line of credit at 10%/year (0.83%/month) that 5can be used to cover all the construction expenses plus all of the accrued interest. What will be the outstanding balance when the bridge is completed? Question 1.b. (10 Points) Once the bridge is open, you will have a steady stream of income, so that you can refinance the construction loan at a lower interest rate, say 8%/year, with the loan being paid off in 30 years. What will the annual payments be on this loan? Question 1.c. (4 Points) What is the annual cash flow (annual proft) from operating the bridge after the bridge opens? Question 1.d. (10 Points) What are you willing to bid for the bridge? IM Parth