This cost-benefit analysis compares the costs and benefits of a proposed supermax prison over a 20-year period. The analysis finds that the total costs are $7.7 million compared to total benefits of $12.8 million. The benefit-cost ratio is 1.56, meaning the benefits are 56% greater than the costs. The internal rate of return is 53.16% and the discounted payback period is 3.55 years. Therefore, the proposed supermax prison passes the cost-benefit test and is recommended.
This cost-benefit analysis compares the costs and benefits of a proposed supermax prison over a 20-year period. The analysis finds that the total costs are $7.7 million compared to total benefits of $12.8 million. The benefit-cost ratio is 1.56, meaning the benefits are 56% greater than the costs. The internal rate of return is 53.16% and the discounted payback period is 3.55 years. Therefore, the proposed supermax prison passes the cost-benefit test and is recommended.
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This cost-benefit analysis compares the costs and benefits of a proposed supermax prison over a 20-year period. The analysis finds that the total costs are $7.7 million compared to total benefits of $12.8 million. The benefit-cost ratio is 1.56, meaning the benefits are 56% greater than the costs. The internal rate of return is 53.16% and the discounted payback period is 3.55 years. Therefore, the proposed supermax prison passes the cost-benefit test and is recommended.
Copyright:
Attribution Non-Commercial (BY-NC)
Available Formats
Download as XLS, PDF, TXT or read online from Scribd
Total $ $7,726,600 $4,340,080 $12,800,000 $6,779,520
Net Present Value $ $2,439,440 Benefit-Cost Ratio 1.56 Internal Rate of Return (IRR) 53.16% Discounted Payback Period in Years 3.55 Notes: (1) Input data in only columns D and H, green highlighted area. Simply override numbers in the Example. (2) Spreadsheet automatically computes Net Present Value (NPV), Benefit-Cost Ratio, IRR, and Discounted Payback Period. (3) You may need to add together certain Costs and Benefits as there is one line per year for this data for each year. Just keep track of your numbers and how you added these together for input on the Spreadsheet. Use brief descriptions. (4) Be sure to adjust all cash flows to 2008 Dollars when using the OMB Circular A-94 Real Discount Rate of 7%.