Business, 18.02.2020 04:56 mardell2587

A new highway is to be constructed.

Design A calls for a concrete pavement costing $85 per foot with a 16-year life;three paved ditches costing $4 per footeach; and four box culverts every mile, each costing $8,000 and having a 16-year life. Annual maintenance will cost $11,800 permile; the culverts must be cleaned every four years at a cost of$300 each per mile.

Design B calls for a bituminous pavement costing $40 per foot with a 8-year life; two sodded ditches costing $1.40 per foot each; and two pipe culverts every mile, each costing $2,200 and having a 8-year life. The replacement culverts will cost $2,400 each. Annual maintenance will cost $2,900 per mile; the culverts must be cleaned yearly at a cost of $230 each per mile; and the annual ditch maintenance will cost $1.45 per foot per ditch.

Compare the two designs on the basis of equivalent worth per mile for a 16-year period. Find the most economical design on the basis of AW and PW if the MARR is 6% per year.

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Answer from: coolman12062

Desing B

Total Present worth $ 502.485,35‬

Annual worth: $ 49,722.003

Option 2:

Total Present worth $ 666.441,33‬

Annual worth: $ 53,845.798

Explanation:

Desing A

$85 x 5280 = 448,800

$4 x 3 x 5280 = 63,360

$8000 x 4 = 32,000

total cost: 544,160‬

Annual cost:

11,800 + 300 = 12,100

PV of the annual maintenance:

$C \times \frac{1-(1+r)^{-time} }{rate} = PV\\$

C12,100.00

time16

rate0.06

$12100 \times \frac{1-(1+0.06)^{-16} }{0.06} = PV\\$

PV$122,281.3328

Present worth:

total cost to construct 544,160‬ + maintenance $122,281.33 = 666.441,33

Annual worth:

$PV \div \frac{1-(1+r)^{-time} }{rate} = C\\$

PV544,160

time16

rate0.06

$544160 \div \frac{1-(1+0.06)^{-16} }{0.06} = C\\$

C $ 53,845.798

Desing B

a mile is equivalent to 5,280 foot

paviment $40 x 5,280 = $ 211,200

sood ditched 2 per foot x 5,280 foot per mile x $1.40 = $ 12,038.4

pipe culvert 2,200 x 2 = 4,400

Total value to construct: 227.638,4‬

PV of maintenance:

replacement 2,400 x 2 = 4,800 (in 8 years)

$\frac{Maturity}{(1 + rate)^{time} } = PV$

Maturity $4,800.0000

time 8.00

rate 0.06000

$\frac{4800}{(1 + 0.06)^{8} } = PV$

PV 3,011.5794

maintenance $2,900

culverts 2 x $ 230 = $ 460

ditch 1.45 x 5,280 x 2 = $ 15,312

Total yearly cost: 18.672‬

PV of this annuity over 16 years:

$C \times \frac{1-(1+r)^{-time} }{rate} = PV\\$

C18,672.00

time16

rate0.06

$18672 \times \frac{1-(1+0.06)^{-16} }{0.06} = PV\\$

PV$188,697.2765

PV of the replacement bituminous concrete

$\frac{Maturity}{(1 + rate)^{time} } = PV$

Maturity $211,200.0000

time 16.00

rate 0.06000

$\frac{211200}{(1 + 0.06)^{16} } = PV$

PV 83,138.0951

Present worth:

Total value to construct: $ 227.638,4‬ +

yearly cost PB $ 188,697.28 +

concrete replacement $ 83,138.0951

culvert replacement: $ 3,011.58

Total Present worth 502.485,35‬

Annual worth:

$PV \div \frac{1-(1+r)^{-time} }{rate} = C\\$

$502485.35 \div \frac{1-(1+0.06)^{-16} }{0.06} = C\\$

C $ 49,722.003

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Answer from: Quest

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A new highway is to be constructed.

Design A calls for a concrete pavement costing $85 p...

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