Cost Benefit Analysis

Paper , Order, or Assignment Requirements

Use the net present value methodology when creating a cost-benefit analysis to evaluate the following project:

The State of Massachusetts would like to replace a National Guard armory rapidly reaching the end of its service life. The Department of Military Affairs has been told that continued special maintenance would be $275,000 annually. Rehabilitation of facility would cost $4,000,000, and would extend the armory’s service life by 15 years.

  1. Calculate the discount factor for each year (use 4% discount rate @ 15 years)
  2. Calculate the annual present value cost of maintenance (15 years)
  3. Calculate the discounted benefit of rehabilitating the armory
  4. Given the discounted cost of rehabilitation, what is the cost- benefit ratio for the proposal?
find the cost of your paper
Responses are currently closed, but you can trackback from your own site.