From the following data for a PPP project, calculate the (a) conventional, and (b) modified benefit/ cost ratios using an interest rate of 6% per year and an infinite project period.
What will be an ideal response?
Determine annual worth values
B = 100,000(0.06) + 100,000
= 6000 + 100,000
= $106,000
D = $60,000
C = 1,800,000(0.06) + 200,000(A/F,6%,3)
= 108,000 + 200,000(0.31411)
= $170,822
S = 90,000
(a) Conventional B/C ratio
B/C = (106,000 – 60,000)/(170,822 – 90,000)
= 0.57
(b) Modified B/C ratio = (B – D + S)/C
= (106,000 – 60,000 + 90,000)/170,822
= 0.80
You might also like to view...
El decimal equivalente a 3/4 es _____.
a. 0.25 b. 0.5 c. 0.75 d. 0.8
What are the advantages of rubber lube?
What will be an ideal response?
When looking for a cause for oil consumption, technicians will often check an engine's ____________________.
Fill in the blank(s) with the appropriate word(s).
In a communicating control system, the system components communicate over a ________ network
A) computer B) commercial C) home D) serial