Question: The initial cost of constructing a flood control dam is estimated to be $5.5 million, with annual upkeep costs of $190,000. Annual benefits (e.g., reduced
The initial cost of constructing a flood control dam is estimated to be $5.5 million, with annual upkeep costs of $190,000. Annual benefits (e.g., reduced flood damage, agricultural development, and tourism, etc.) are expected to be $2.75 million, whereas the disbenefits from significant ecological and human social changes are expected to be $0, 055 million per year. Assume the dam will have a useful life of 50 years. At an interest rate of 6% per year, should the dam be constructed on the basis of its conventional B-C ratio, with AW as the equivalent-worth measure
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