the exam. Put a box around your final answers. 1. (20 pts) You can invest in one of two mutually exclusive opportunities (A or B) with different study lives. Your MARR is 1.2% per month. Use the most efficient method to make your decision. Cash flows are given in the tables below: 2 A Month Cash flow 0 -1000 1 0 0 0 0 5 0 6 0 7 1200 AWN B Month Cash flow -3000 1 0 2 0 3 0 4 0 5 0 6 0 7 0 8 0 9 0 10 0 11 3500 2. (20 pts) You community decides to build a new highway bypass to reduce traffic congestion. The initial capital cost of the bypass will be $100,000,000. Annual maintenance will be $3,000,000, and periodic resurfacing will cost $15,000,000 every six years. The plan is to sell a municipal bond at 6% to fund the bridge. 2.1. (5 pts) Show your cash flow diagram: 2.2. (9 pts) What is the capitalized cost of the bypass? 2.3. (4 pts) What is the annualized cost of the bypass to the community? 2.4. (2 pts) If the community can accept $10,000,000/yr increase to its tax base, can the bypass be approved and built? the exam. Put a box around your final answers. 1. (20 pts) You can invest in one of two mutually exclusive opportunities (A or B) with different study lives. Your MARR is 1.2% per month. Use the most efficient method to make your decision. Cash flows are given in the tables below: 2 A Month Cash flow 0 -1000 1 0 0 0 0 5 0 6 0 7 1200 AWN B Month Cash flow -3000 1 0 2 0 3 0 4 0 5 0 6 0 7 0 8 0 9 0 10 0 11 3500 2. (20 pts) You community decides to build a new highway bypass to reduce traffic congestion. The initial capital cost of the bypass will be $100,000,000. Annual maintenance will be $3,000,000, and periodic resurfacing will cost $15,000,000 every six years. The plan is to sell a municipal bond at 6% to fund the bridge. 2.1. (5 pts) Show your cash flow diagram: 2.2. (9 pts) What is the capitalized cost of the bypass? 2.3. (4 pts) What is the annualized cost of the bypass to the community? 2.4. (2 pts) If the community can accept $10,000,000/yr increase to its tax base, can the bypass be approved and built