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Los Angeles Department ofTransportation is considering an extra 20 miles toll road lane on the 4GB freeway in partnership with a private investment firm. The
Los Angeles Department ofTransportation is considering an extra 20 miles toll road lane on the 4GB freeway in partnership with a private investment firm. The project costs $4 mil the first year, 525 mil in year 2 to 4 and $15 mil in year 5. Annual cost of operation and revenue is $1 mil and $2 mil respectively for 3D years after completion of the project in 5 years. If the disbenefit is $1mil per year for the first 25 years. Assuming 5% MARR: A] Evaluate economics of this proposal using modied BEE analysis. B} Repeat the economic analysis in part A for the private firm investors if they can excl ' efit consideration in their BIC analysis. 1What conclusions do you get from this analysis
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