Question: Two alternatives will be evaluated to build a new highway. One through the valley bordering the river (30 miles) and another across the hills
Two alternatives will be evaluated to build a new highway. One through the valley bordering the river (30 miles) and another across the hills (22 miles). The valley route has an initial cost of $28,500,000. Its annual maintenance cost is $10,000 per mile and involves a major repair every 10 years at a cost of $2,300,000. The hill route costs $38 million and costs $16,000 per mile to maintain and involves a major repair every 15 years at a cost of $3 million. Traffic on both routes will be 6,000 vehicles per day, of which a quarter will be commercial. It will be possible to travel at an average speed of 50 miles per hour. The time cost for a commercial vehicle is $30 per hour and for a regular vehicle it is $10 per hour. The cost per mile is $1.50 per commercial vehicle and $.50 per regular vehicle for the river route. The cost per mile is $1.75 per commercial vehicle and $.60 per regular vehicle for the hill route. Assume a useful life of 30 years and a MARR of 7%. (30pts)
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Analysis of Highway Alternatives Valley vs Hill Route Project Data Feature Valley Route Hill Route Miles 30 22 Initial Cost 28500000 38000000 Annual M... View full answer
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