Question: For a residential building project, the developer has estimated the capital investment, net rental revenue, and resale value after 6 years for the following

For a residential building project, the developer has estimated the capital investment,net rental revenue, and resale value after 6 years for the following

For a residential building project, the developer has estimated the capital investment, net rental revenue, and resale value after 6 years for the following three scenarios. Given the developer's MARR is 8%, what is the estimated B/C ratio of this project? Optimistic Most Likely Pessimistic Capital investment $2,132,150 $2,342,900 $2,761,215 Resale value $2,535,515 $2,440,707 $2,325,176 Net annual benefit $279,002 $226,657 $198,121 8% Compound Interest Factors Single Payment Uniform Payment Series Arithmetic Gradient Compound Present Sinking Capital Compound Present Gradient Gradient Amount Worth Fund Recovery Amount Worth Uniform Present Factor Factor Factor Factor Factor Factor Series Worth Find F Find P Find A Find A Find F Find P Find A Find P Given P Given F Given F Given P Given A Given A Given G Given G n F/P P/F A/F A/P F/A P/A A/G P/G n 1 1.080 .9259 1.0000 1.0800 1.000 0.926 0 0 1 2 1.166 8573 4808 .5608 2.080 1.783 0.481 0.857 2 3 1.260 7938 .3080 3880 3.246 2.577 0.949 2.445 3 4 1.360 .7350 2219 3019 4.506 3.312 1.404 4.650 4 5 1.469 .6806 .1705 2505 5.867 3.993 1.846 7.372 5 6 1.587 .6302 .1363 2163 7.336 4.623 2.276 10.523 6 7 1.714 5835 .1121 1921 8.923 5.206 2.694 14.024 7 8 1.851 5403 0940 1740 10.637 5.747 3.099 17.806 8 9 1.999 5002 .0801 .1601 12.488 6.247 3.491 21.808 9 10 2.159 4632 .0690 1490 14.487 6.710 3.871 25.977 10 Compound Interest Factors 8% Single Payment Uniform Payment Series Compound Present Sinking Capital Compound Present Gradient Arithmetic Gradient Gradient Amount Worth Fund Recovery Amount Worth Uniform Present Factor Factor Factor Factor Factor Factor Series Worth Find F Find P Find A Find A Find F Find P Find A Find P Given P Given F Given F Given P Given A Given A Given G Given G F/P P/F A/F A/P F/A P/A A/G P/G " 1 1.080 9259 1.0000 1.0800 1.000 0.926 0 0 1 2 1.166 8573 4808 5608 2.080 1.783 0.481 0.857 2 1.260 .7938 3080 3880 3.246 2.577 0.949 2.445 3 4 1.360 7350 2219 3019 4.506 3.312 1.404 4.650 4 5 1.469 6806 1705 12505 5.867 3.993 1.846 7.372 5 6 1.587 .6302 .1363 2163 7.336 4.623 2.276 10.523 6 7 1.714 5835 1121 1921 8.923 5.206 2.694 14.024 7 8 1.851 5403 0940 1740 10.637 5.747 3.099 17.806 8 9 1.999 5002 0801 1601 12.488 6.247 3.491 21.808 9 10 2.159 4632 0690 1490 14.487 6.710 3.871 25.977 10 11 2.332 4289 .0601 1401 16.645 7,139 4.240 30.266 11 12 2.518 3971 0527 1327 18.977 7.536 4.596 34.634 12 13 2.720 3677 0465 1265 21.495 7.904 4.940 39.046 13 14 2.937 3405 0413 1213 24.215 8.244 5.273 43.472 14 15. 3.172 3152 0368 1168 27.152 8.550 5.594 47.886 15

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