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The city of Columbus has identified three options for a public recreation area suitable for informal family activities and major organized events. As with most
The city of Columbus has identified three options for a public recreation area suitable for informal family activities and major organized events. As with most alternatives today, there are benefits, disbenefits, costs, and some savings. These have been estimated with the help of an external planning consultant and are identified in the table below. In each case, these are annualized over a 10-year planning horizon. Option 1 Option 2 Option 3 Benefits $410,000 $510,000 $575,000 Disbenefits $78,000 $130,000 $160,000 Costs $225,000 $395,000 $455,000 Savings $31,000 $73,000 $82,000 a. Determine the B/C ratio for: Option 1: Option 2: Option 3: Do all calculations to 5 decimal places and round final answer to 2 decimal places. Tolerance is + 0.02. Can you tell from these ratios which option should be selected? b. Determine which option should be selected using the incremental B/C ratio. c. Determine which option should be selected using the B-C for each option. d. At what value of Option 2 costs are you indifferent between Option 1 and Option 2?$ Do all calculations to 5 decimal places and round final answer to whole dollar. Tolerance is 50
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