Question

Consider a proposal to replace a road/railway level crossing with a grade separation structure, estimated to cost $5,000,000, requiring major repair expenditure of $300,000 every 20 years, and annual maintenance of $13,000, if interest rate is assumed to be 5%. The annual costs for operation and maintenance of the crossing total $58,600, while the costs of delays to road traffic being held up by trains is estimated to be $87,250 per annum. Based on past statistics, the crossing is responsible for an average cost of $200,000 a year in payment of damages for accidents. Is the proposal worthwhile?

Answer 1

Kindly Upvote!