ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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Question
Chapter 16, Problem 26P
To determine
The better plan out of two plans.
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Students have asked these similar questions
A proposal to reduce traffic congestion on Jounieh Highway has a B/C
ratio of 1.4. The annual worth of benefits minus disbenefits is $560,000.
What is the first cost of the project if the interest rate is 5% per year and
the project is expected to be perpetual?*
4,000,000
4,588,208
8,000,000
6,666,667
Consider a piece of equipment that has the following cost and benefit estimates, and the interest rate is 15% per year:
Initial investment: $200,000
Equipment life: 10 years
Salvage value: $10,000
Annual receipts: $100,000
Annual expenses: $50,000
What is the modified B/C ratio of this equipment?
Click the icon to view the interest and annuity table for discrete compounding when = 15% per year.
Thr modified cost-benefit ratio is
(Round to two decimal places.)
According to the B-C ratio method, the project is
More Info
Single Payment
Compound
Amount
Present
Factor
Worth Factor
To Find F
To Find P
Discrete Compounding; /= 15%
Compound
Amount
Factor
To Find F
Uniform Series
Sinking
Present
Capital
Recovery
Worth Factor
To Find P
Fund
Factor
To Find A
Factor
To Find A
Given P
Given F
Given A
Given A
Given F
Given P
N
FIP
P/F
F/A
PIA
A/F
A/P
1
1.1500
0.8696
1.0000
0.8696
1.0000
1.1500
2
1.3225
0.7561
2.1500
1.6257
0.4651
0.6151
3
1.5209
0.6575
3.4725
2.2832
0.2880
0.4380
4
1.7490
0.5718…
A shopping center is to be built in one of four different cities. The cash flow estimates associated with each alternative are given below. You will be using the conventional B/C ratio method to determine which city
should be selected at an interest rate of 15% per year. One alternative must be selected. The following table shows the details of each alternative.
Alternative
Benefits, s/year
Disbenefits, $/year
ERR
City1
95
12
8
170
City2
Life, years
First cost, $
M&O costs, $/year
Please find the following
- B/C of City1
✓ Incremental B/C of City1 vs. City3
30
110
55
12
210
30
City3
90
12
8
160
30
City4
105
15
10
180
25
Based on the incremental B/C analysis applied to all four cities, choose one city among the four
cities.
A. 1.22
B. City3
C. 0.00
D. City2
E. 2.50
F. 1.00
G.1.19
H.City4
1. City1
J. 2.24
K. 1.48
Chapter 16 Solutions
ENGR.ECONOMIC ANALYSIS
Ch. 16 - Prob. 1QTCCh. 16 - Prob. 2QTCCh. 16 - Prob. 3QTCCh. 16 - Prob. 4QTCCh. 16 - Prob. 1PCh. 16 - Prob. 2PCh. 16 - Prob. 3PCh. 16 - Prob. 4PCh. 16 - Prob. 5PCh. 16 - Prob. 6P
Ch. 16 - Prob. 7PCh. 16 - Prob. 8PCh. 16 - Prob. 9PCh. 16 - Prob. 10PCh. 16 - Prob. 11PCh. 16 - Prob. 12PCh. 16 - Prob. 13PCh. 16 - Prob. 14PCh. 16 - Prob. 15PCh. 16 - Prob. 16PCh. 16 - Prob. 17PCh. 16 - Prob. 18PCh. 16 - Prob. 19PCh. 16 - Prob. 20PCh. 16 - Prob. 21PCh. 16 - Prob. 23PCh. 16 - Prob. 24PCh. 16 - Prob. 25PCh. 16 - Prob. 26PCh. 16 - Prob. 27PCh. 16 - Prob. 28PCh. 16 - Prob. 29PCh. 16 - Prob. 30PCh. 16 - Prob. 31PCh. 16 - Prob. 32PCh. 16 - Prob. 33PCh. 16 - Prob. 34PCh. 16 - Prob. 35PCh. 16 - Prob. 36PCh. 16 - Prob. 37PCh. 16 - Prob. 38PCh. 16 - Prob. 39PCh. 16 - Prob. 40PCh. 16 - Prob. 41PCh. 16 - Prob. 42PCh. 16 - Prob. 43PCh. 16 - Prob. 44PCh. 16 - Prob. 45PCh. 16 - Prob. 46PCh. 16 - Prob. 47PCh. 16 - Prob. 48PCh. 16 - Prob. 49P
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