Question: for this question i = 9% Case 2: You are the engineer who is responsible of constructing a new toll road. The discount rate is

for this question i = 9%for this question i = 9% Case 2: You are the engineer

Case 2: You are the engineer who is responsible of constructing a new toll road. The discount rate is i% per year, and the study period is 30 years. Evaluate the economics of the proposal using: (a) present worth analysis (b) the conventional B/C analysis and; (c) the profitability index from in which disbenefits are not included. Initial investment: $88 million distributed over 5 years; $4 million now and in year 5 and $20 million in each of years 1 through 4. Annual M&O cost: $1 million per year, plus an additional $3 million each fifth year, including year 30. Annual revenue benefits: start at $2 million in year 1, increasing by a constant $0.5 million annually through year 10, and then increasing by a constant $1 million per year through year 20 and remaining constant thereafter. Disbenefits from buying land and property in the road route surrounding areas: start at $10 million in year 1, decrease by $0.5 million per year through year 21, and remain at zero thereafter. Case 2: You are the engineer who is responsible of constructing a new toll road. The discount rate is i% per year, and the study period is 30 years. Evaluate the economics of the proposal using: (a) present worth analysis (b) the conventional B/C analysis and; (c) the profitability index from in which disbenefits are not included. Initial investment: $88 million distributed over 5 years; $4 million now and in year 5 and $20 million in each of years 1 through 4. Annual M&O cost: $1 million per year, plus an additional $3 million each fifth year, including year 30. Annual revenue benefits: start at $2 million in year 1, increasing by a constant $0.5 million annually through year 10, and then increasing by a constant $1 million per year through year 20 and remaining constant thereafter. Disbenefits from buying land and property in the road route surrounding areas: start at $10 million in year 1, decrease by $0.5 million per year through year 21, and remain at zero thereafter

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