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The following information applies to the questions displayed below.] Washington County's Board of Representatives is considering the construction of a longer runway at the county

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The following information applies to the questions displayed below.] Washington County's Board of Representatives is considering the construction of a longer runway at the county airport. Currently, the airport can handle only private aircraft and small commuter jets. A new, long runway would enable the airport to handle the midsize jets used on many domestic flights. Data pertinent to the board's decision appear below Cost of acquiring additional land for runway Cost of runway construction Cost of extending perimeter fence Cost of runway lights Annual cost of maintaining new runway Annual incremental revenue from landing fees 60,000 305,000 53,937 30,000 15,000 20,000 In addition to the preceding data, two other facts are relevant to the decision. First, a longer runway will require a new snowplow, which will cost new, larger plow will cost $6,000 more in annual operating costs. Second, the County Board of Representatives believes that the proposed long runway, and the major jet service it will bring to the county will increase economic activity in the community. The board projects that the increased economic activity will result in $68,000 per year in additional tax revenue for the county $105,000. The old snowplow could be sold now for $10,500. The In analyzing the runway proposal, the board has decided to use a 10 year time horizon. The county's hurdle rate for capital projects is 7 percent Use Appendix A for your reference. (Use appropriate factors) from the tables provided.) Required 1. Prepare a net-present-value analysis of the proposed long runway. 2. Should the County Board of Representatives approve the runway considering NPV? 3-a. Which of the data used in the analysis are likely to be most uncertain? 3-b. Which of the data used in the analysis are likely to be least uncertain? In analyzing the runway proposal, the board has decided to use a 10-year time horizon. The county's hu rate for capital projects is 7 percent. Use Appendix A for your reference. (Use appropriate factorts) from the tables provided.) Required: 1. Prepare a net-present-value analysis of the proposed long runway 2. Should the County Board of Representatives approve the runway considering NPV? 3-a. Which of the data used in the analysis are likely to be most uncertain? 3-b. Which of the data used in the analysis are likely to be least uncertain? Complete this question by entering your answers in the tabs below. Req 1Req 2Req 3AReq 3B Prepare a net-present-value analysis of the proposed long runway. (Round your "Annuity discount factor" to 3 decimal places. Negative amounts should be indicated by a minus sign.) Show lessA Annual incremental benefit Annuity discount factor Present value of annual benefits Initial costs 0 Net present value Req 1 Req2

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