DOT is performing benefit-cost analysis of new highway

Assignment Help Business Economics

Reference no: EM131096222

A DOT is performing a benefit-cost analysis of a new highway using an analysis period of 40 years as part the required environmental impact assessment of the project. The section of highway is estimated to have a construction cost $260 million dollars. The public benefit in reduced travel time and economic development around the highway is estimated to be $17 million per year for the first 5 years, then decrease by 3% per year for the remainder of the 40 year analysis period as congestion grows and economic development slows. The public disbenefit is estimated to be $1.3 million dollars in year 0 due to additional congestion and pollution during construction and then average $170,000 per year over the 40-year project life in environmental costs due to increased runoff and vehicle emissions. Using an interest rate of 4%, determine the benefit-cost ratio for this project using public/government version of the B/C ratio. Express your answer to two decimal places. Please show the correct steps for this question

Reference no: EM131096222

Questions Cloud

Exchange rates-valuation from interest rates-inflation rate : Exchange rates, in simple terms, is the valuation of 1 currency in relation to a second currency. As many of you have stated, various factors play into this valuation from interest rates, inflation rates, expectations (economic growth, consumer spend..

Equation for the market demand for harry potter : (a) What is the equation for the market demand for Harry Potter books if all consumers have the same equation for demand as Laurel? (b) What is the price elasticity of the market demand for Harry Potter at P = 12.5? Compare it to Laurel's price e..

Estimate the rate of corrosion in ipy and mm per year : Estimate the rate of corrosion in ipy and mm per year.

Discuss statement using consumer theory : A welfare system in which benefits take the form of cash payments to recipients is preferable to one based on the use of price subsidies on merit goods. Discuss this statement using consumer theory to illustrate your arguments.

DOT is performing benefit-cost analysis of new highway : A DOT is performing a benefit-cost analysis of a new highway using an analysis period of 40 years as part the required environmental impact assessment of the project. The section of highway is estimated to have a construction cost $260 million dollar..

The following text presented to a c scanner : What token sequence is produced? For which tokens must extra information be returned in additional to the token code?

Discrepancy between wealth and poverty in the united states : What impact does the discrepancy between wealth and poverty in the United States have on society? What are some of the emotional and physical consequences of poverty on individuals?

Identify risk drivers in project and the risks associated : Identify risk drivers in your project and the risks associated with each and explain how the risks you identified could impact the project, and propose strategies to mitigate each risk.

Advise the federal reserve chairman : Assume that you have been invited to advise the Federal Reserve Chairman about the direction of U.S. monetary policy for the year ahead.

User Account

All Pages