Determining the benefit-cost analysis

Assignment Help Business Economics
Reference no: EM131809346

A government agency is planning a new office building close to its current headquarters. Four proposed sites are to be evaluated. Any of these sites will save the agency $700,000 per year, since two of its current satellite offices will no longer need to be rented. The agency uses a 6% interest rate and assumes that the building and its benefits will last for 40 years. Based on a benefit-cost analysis what should the agency do?

2425_benefit–cost analysis.png

Contributed by Hamed Kashani, Saeid Sadri, and Baabak Ashuri, Georgia Institute of Technology.

Reference no: EM131809346

Questions Cloud

What total incremental cost will martinez incur increase : What total incremental cost will Martinez incur if it increases production from 11,000 to 11,001 units
Relationship in sale price of a home and number of bedrooms : Areal tor in Arlington, Massachusetts, is analyzing the relationship between the sale price of a home (Price), its square footage (Sqft).
Consider four alternatives : If the MARR is 8%, which alternative should be selected? Solve the problem by benefit-cost ratio analysis.
Strategic vision outlines management aspirations : A strategic vision outlines management's aspirations for the business, providing a panoramic view of ‘where we are going’ and a convincing rationale
Determining the benefit-cost analysis : Based on a benefit-cost analysis what should the agency do?
Read the article affirmative action and what it means : Watch this brief video, Education Eliminates the Gap Between the "Haves" and "Have-nots" , for more information on this.
Prepare an amortization table for these given bonds : The annual market rate at the date of issuance is 10%, and the bonds are sold for $85,431. Prepare an amortization table for these bonds
Compute the benefit-cost ratio : Using an 8-year analysis period and a 10% interest rate, compute the benefit-cost ratio.
Prepare the journal entries to record the expenditure : Prepare the journal entries to record the $68000 expenditure, and the first year amortization using an 8 years life

Reviews

Write a Review

Business Economics Questions & Answers

  Expenditures are excessive and ought to be reduced

Suppose every member of Congress genuinely believes that government expenditures are excessive and ought to be reduced by at least 10 percent. Why would this not be sufficient to assure a 10 percent reduction?

  Mike optimal amount of consumption

Mike's utility function for consumption and leisure is U(C; L) = C1=2 L1=2. There are 168 hours in the week and he earns $10 per hour. a) What is Mike's optimal amount of consumption, hours of work and of leisure?

  Space of all possible valid outcomes

Write down the outcome space, i.e., the space of all possible valid outcomes in this lottery.

  Differences in institutional economics-behavioral economics

Both Thorstein Veblen on the one hand and Daniel Kahneman and Amos Tversky on the other challenged standard neoclassical notions of rationality. Explain the similarities and differences between institutional economics(Veblen) and Behavioral Economics..

  Assume a fixed exchange rate

For each of the following situations, use the IS-LM-FX model to illustrate the effects of the shock. For each case, state the effect of the shock on the following domestic variables (increase, decrease, no change, or ambiguous) and explain why we obs..

  The demand curve for haircuts

Where Q is the number of cuts per week and P is the price of a hair cut. Terry is considering raising her price above the current price of $15. Terry is unwilling to raise price if the price hike will cause revenues to fall. Should Terry raise the pr..

  Identical demand function

Efficient regulation. Suppose the state is trying to decide how many miles of a very scenic river it should preserve. There are 1000 people in the community, each of whom has an identical demand function given by. If the marginal cost of preservation..

  Percentage effect which increase in output

The percentage effect which increase in output will have on the profit made from producing and selling commodity Alpha will be.

  Stabilize aggregate demand

If instead the Fed wants to stabilize aggregate demand, how should it change the money supply..

  About half of the paid lobbyists

About half of the paid lobbyists in Washington are former government staff members or former members of Congress. Why would interest groups employ such people? Why might some reformers want to limit the ability of interest groups to employ them?

  Equilibrium of price-quantity-consumer and producer surplus

Equilibrium of Price/Quantity/Consumer Surplus/Producer Surplus? If a tax is introduced and it is $1 per unit, what are the new Price/Quantity/Consumer Surplus/ Producer Surplus/ tax revenues? What is the deadweight loss of the tax?

  Who sells permits and explain how many do y sell

Who sells permits and Explain how many do y sell. Who buys permits and Explain how many do y buy. Briefly explain why sellers and buyers are each willing to do so. Illustrate what is total cost of pollution reduction in this situation.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd