Final answer:
To determine the better present worth (PW) between a suspension bridge and a cantilever bridge, one must perform a present worth analysis on the cash flows associated with each option, using the 8% interest rate and comparing over 50 years. Future costs and benefits are discounted to present value, and the design with the higher present worth is the economically favorable choice. The analysis should consider all costs and potential risks or benefits each design may have.
Step-by-step explanation:
To determine which bridge design, either a suspension bridge or a cantilever bridge, has the better present worth (PW) for new evacuation routes out of New Orleans, one would need to perform an economic analysis considering the costs associated with each bridge option. This analysis typically involves calculating the initial construction costs, ongoing maintenance expenses, and eventual dismantling costs, all discounted at the department's chosen interest rate of 8%. Those cash flows are then compared over the projected 50-year lifespan of the bridges.
The present worth method is used to find the present value of all cash flows associated with a project, which allows a comparison between different projects or designs that may have varying lifespans and costs. In this method, future costs and benefits are discounted to their present value using a discount rate, which is the interest rate mentioned. The option with the higher present worth is typically considered the more economically favorable choice, as it implies lower costs over time when adjusted for the time value of money.
Conducting a thorough present worth analysis will reveal which bridge design is more cost-effective over the 50 years, accounting for all associated costs and using the appropriate mathematical tools to ensure a sound financial decision is made. The analysis should factor in any potential risks or benefits that each design might have in terms of longevity, maintenance needs, and ability to withstand future natural disasters.