Question: A city is considering an infrastructur project that involves the construction of a new light rail transit ( LRT ) line to improve urban mobility

A city is considering an infrastructur project that involves the construction of a new light rail transit (LRT) line to improve urban mobility and reduce traffic congestion. The LRT line is expected to span 20 linear kilometers and serve an estimated 50,000 passengers per day. The following data has been provided for the project:
Costs:
Initial Construction Costs: $1.5 billion
Annual Operating and Maintenance Costs: $50 million
Rolling Stock Costs (trains and carriages): $200 million (one-time cost)
Interest Rate: 4%(for discounting future costs and benefits)
Benefits:
Travel Time Savings**: 15 minutes per trip on average
Value of Time**: $15 per hour per passenger
Reduction in Vehicle Operating Costs**: $1 per trip
Reduction in Accident Costs**: $5 million annually
Environmental Benefits**: $10 million annually (reduction in pollution and greenhouse gases)
Additional Information:
-The project lifespan is expected to 30 years.
The light rail is expected to replace 20,000 car trips daily.
The average car trip length replaced by the LRT is 15 kilometers.
Please answer the following questions regarding the project:
A. Calculate the total annual benefits of the LRT project.
B. Calculate the Net Present Value (NPV) of the project over its 30-year lifespan, including both costs and benefits.
C. Determine the Benefit-Cost Ratio (BCR) for the project.
D. Based on your calculations, provide a recommendation on whether the city should proceed with the construction of the LRT line. Justify your recommendation with the calculated metrics.
A city is considering an infrastructur project

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