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The U.S. Department of Interior is planning to build a dam and construct a hydroelectric power plant. In addition to

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The U.S. Department of Interior is planning to build a dam and construct a hydroelectric power plant. In addition to producing electric power, this project will provide flood control. irrigation, and recreational benefits. The estimated benefits and costs expected to be derived from the three alternatives under consideration are listed as follows:

The interest rate is 5%, and the life of each project is estimated to be 40 years.
(a) Find the benefit—cost ratio for each alternative.
(b) Select the best alternative, according to BC(i).
(c) Select the best alternative, according to Pl(i).

Transcribed Image Text:

TABLE P16.10 Initial investment Annual recurring benefits Annual recurring costs Salvage value Design Alternatives A $100 M $20M $8M 0 B $160M $40M $18M 0 с $220M $60M $25M 0

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Contemporary Engineering Economics

Contemporary Engineering Economics

ISBN: 9780134105598

6th Edition

Authors: Chan Park

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Question Details
Chapter # 16
Section: Problems
Problem: 10
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Question Posted: December 30, 2022 00:24:25
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