DiscussFOURprobably reasons why the government of Jamaica still have an influential presence in the transportation industry.(12 marks)

c.Briefly explain TWO major factors that influence the demand of international transport services (4 marks)

2. Distinguish between divestiture, greenfield and concession investment in transport, provide relevant examples in the context of Jamaica. {5 marks}

b.The private sector is considering a long-term concessionary agreement with the government to operate and expand the Port of Kingston. Briefly explain FOUR possible environmental impact that this expansion could have on the eco-system.{8 marks}

c.Discuss, using examples,FOURways that the Jamaican government have attempted to provide first world transportation for its citizens over the last ten years. (12 marks)

3. You have been recently hired by the National Works Agency (NWA) to oversee the construction of the May Pen Bypass that will divert the traffic from the city centre. The citizens living in the environs of this road construction requested a meeting with your company. You have been asked to address this group.

a.Discuss FOUR economic and FOUR social benefits to this investment. (8 marks)

b.Explain FIVE external costs that these citizens may experience while the construction of the road is in progress. (10 marks)

c.Discuss TWO strategies that could be adapted to address the costs identified in (b) above. (7 marks)

4.Trans Jamaica Corporation wishes to invest in one of three transport infrastructure projects X, Y and Z with initial outlays of $500 million, $390 million and $650 million respectively. Projects are expected to produce each year free after-tax cash flows of $195 million for project X, project Y is expected to generate $250 million and project Z $292 million. Each project has depreciable lives of 9 years. The required rate of return is 18%.

I.Use the Net Present Value Technique and determine the most appropriate investment for Delta Corporation. Justify your response. (9 marks)

II.State two benefits and two disadvantages of using the NPV. (4 marks)

III.Though the payback method for evaluating capital investments has some serious flaws, it is popular in business practice, showing up on most financial evaluation software packages.

IV.Outline three reasons why the payback method is popular in business? (3 marks)

V. Why would a manager not accept a project that has a positive net present value?(4 marks)What decision criterion would you recommend for:

a. Mutually Exclusive Projects and (3 marks)

b. Projects being evaluated under capital constraints. (2 marks)