Cost Benefit Analysis of Tempisque Bridge

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Cost Benefit Analysis of Tempisque Bridge
In 1992 , Costa Rica 's Minister of Public Works and Transport (MOPT benefit-cost analysis suggested it was worthwhile to construct a bridge over Tempisque River to connect the province of Guanacaste to San , Jose Costa Rica 's capital . Environmentalists and tourism representatives opposed the construction of the bridge 1 .1 Reasons for Building the Bridge

Population of Guanacaste province is declining ever since the World Bank urged the removal of tariffs protecting Costa Rican agriculture which drove many marginal farms out of business . Young people migrate to San Jose in search for jobs and better economic conditions Benefits for Building the Bridge

Financial Benefit from Building the Bridge
Bridge Net Present Value 424 ,000
Internal Rate of Return 12 .38
Benefit Cost Ration 1 .036
Cost of Building the Bridge
Costs of Bridge construction 1 ,918 million
Costs of Bridge Maintenance 1 .29 million /year
Value of Bridge 2013 1 ,151 million
Bridge Net Present Value 424 ,000
Internal Rate of Return 12 .38
Benefit Cost Ration 1 .036
2 .3 Reduce ferry operation and capital costs
Refurbishing Cost 2000 and 2010 52 .5 million
Scrap value of ferry in 2013 36 .75 million
2 .4 Savings in vehicle operating costs and travel time
Travel time equals average wage rates of vehicle occupants times number of occupants per vehicle . Reduction of one hour in travel time , reduces 42949 for bus 274 for car or pickup , and 194 for heavy truck . Reduce vehicle operating costs . Vehicle operating costs are a function of distance , speed and condition of road surface Saving in vehicle operating costs 104 .02 million

Saving in travel time 91 .16 million 2 .5 Traffic increase by 30 This is because opening of a new bridge would reduce travel time and thus increase travel time causes one percent increase in traffic . Since the new bridge would reduce travel time by 30 , traffic is expected to increase by 30 Costs of B /C Analysis...
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