Evaluation

Question 1

Project without private counter parts is?

Answer 1

discountrateshould reflectonlytheprevailinggovernmentborrowingrate
(e.g.Irrigationprojects)

Question 2

Projects with private counter parts is?

Answer 2

discountrateshould
representtheratethatcouldhavebeenearnedhadthefunds
notbeenremovedfromtheprivatesector.(e.g.powerplant)

Question 3

In benefit cost analysis if incremental cost equals zero which option should be chosen?

Answer 3

option with highest incremental benefit.

Question 4

What is life cycle costing?

Answer 4

Total cost throughout its life includingplanning, design,acquisitionandsupportcostsandanyother
costsdirectlyattributabletoowningorusingtheasset

Question 5

Why use life cycle costing?

Answer 5

pick most cost effective solution

supports ongoing cost monitoring