{"id":8103,"date":"2021-10-22T18:38:34","date_gmt":"2021-10-22T07:38:34","guid":{"rendered":"https:\/\/casestudyhelp.com\/sample-questions\/?p=8103"},"modified":"2021-10-22T18:40:48","modified_gmt":"2021-10-22T07:40:48","slug":"cive1217-engineering-economics-and-infrastructure-planning-assessment-answers","status":"publish","type":"post","link":"https:\/\/casestudyhelp.com\/sample-questions\/cive1217-engineering-economics-and-infrastructure-planning-assessment-answers\/","title":{"rendered":"CIVE1217 Engineering Economics and Infrastructure Planning Assessment Answers"},"content":{"rendered":"

CIVE1217 Case Study Solutions on Engineering Economics and Infrastructure Planning<\/h2>\n

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Executive Summary<\/strong><\/h3>\n

The case study report is related to a Huge Traffic issue, which Melbourne citizens are facing in Tullamarine Freeway from Bulla Road to Sunbury Road, it is the main route to approach Airport. Main issue is that now it is taking almost 3 times to travel which it used to take in 2000, i.e from 11 minutes in 2000 to 36.5 minutes in 2020. In this report, two options are analysed further for its feasibly out of various options available to identify the best one in terms of time taken and cost effectiveness. Options analysed are:-<\/p>\n

Option 1 \u2013 Railway from Melbourne airport to Sunshine station<\/p>\n

Option 3 \u2013 Widening Tullamarine Freeway<\/p>\n

Introduction<\/strong><\/h3>\n

Tullamarine Freeway, which is commonly referred as \u201cTulla\u201d is the main urban freeway in Melbourne which links Airport to City. It is 13 KM, M2 freeway. (WE EF LIVE 2018), it is one of the busiest freeways in Australia, carrying up to 210,000 vehicles\/day. And this has creates a huge traffic turmoil every day on this stretch and travels have to spend almost 3 times of the actual time it should take. There is huge wastage of time, energy in terms of fuel and manpower.<\/p>\n

Following options are available to overcome this situation:-<\/p>\n

Option 1 – Railway from Melbourne terminal to Sunshine station A railway was recommended to link Melbourne airport on the rail system. This will relieve the visitors at Tullamarine Freeway. The proposed railway would’ve 2 rail tracks (one for every direction). The line measurements are 27km, and variety of station inside the path hasn’t been decided.<\/p>\n

Option 2 – Building a tunnel Build 2 tunnels that connect Citylink (from Bulla road) to the terminal. The tunnels are around 6km each and also will have 2 lanes each direction.<\/p>\n

Option 3 – Widening Tullamarine Freeway The present Freeway has 4 lanes each way. Adding extra lanes on the freeway (one additional lane per direction) is the final choice.<\/p>\n

Option 4 – Do nothing (with normal maintenance and operation, etc.) Keep present state with normal maintenance and operation.<\/p>\n

Problem Diagnosis<\/strong><\/h3>\n

Problem statement is the High Travel Time and Cost incurred due to Fuel and time of citizen for the additional time taken.<\/p>\n

Goal and objective articulations: Goal is to reduce the time required to travel to Airport by finding the best alternative option and also reduce the load on the Tullamarine Freeway, which was originally made with a target of 20000 Vehicles<\/p>\n

Basic Cost Information: As per the Information Available cost estimates are:-<\/p>\n

Land<\/p>\n

Commercial\/Residential Land => $1 Billion per km2<\/p>\n

Industrial land => $750 Million per km2<\/p>\n

Arable\/Farming\/Other => $400 Million per km2<\/p>\n

Construction<\/p>\n

Railway => $35 Million\/KM<\/p>\n

Tunnels => $550 Million\/KM<\/p>\n

Widening the Freeway => $7 Million \/ plane\/ KM<\/p>\n

Forecasting<\/strong><\/h3>\n

Option 1- Railway Track<\/p>\n

Assumptions:-<\/p>\n

    \n
  • Life of the Railway coaches: 20 Years Minimum<\/li>\n<\/ul>\n
      \n
    • Capital Cost: – Additional Coaches to be used to carry passenger, but assumed that it will be from the current stock only no additional coaches will be acquired<\/li>\n<\/ul>\n
        \n
      • More No. of Trains will be required in the morning hours of 6 AM to 9 AM and evening 5 PM to 9 PM<\/li>\n<\/ul>\n
          \n
        • Land Requirement is 30 KM ( as 27 KM for track + 10% extra additional)<\/li>\n<\/ul>\n
            \n
          • Station construction cost is also not considered as current stations will be used<\/li>\n<\/ul>\n
              \n
            • Type of Land- Farm land will be used as generally tracks are near farms only<\/li>\n<\/ul>\n
                \n
              • Currently No. of Passengers travelling Approx.- 70000(Vehicle\/Day ) So approx. 70000 even if it is one person per vehicle<\/li>\n<\/ul>\n
                  \n
                • Capacity of the Freeway : 20000Vehicles<\/li>\n<\/ul>\n
                    \n
                  • So Gap is = 70000-20000= 50000 Passenger<\/li>\n<\/ul>\n
                      \n
                    • Let\u2019s Assume the Target is to reduce the burden by 20000 i.e. 40% and shift them to alternative option of travel by train<\/li>\n<\/ul>\n
                        \n
                      • Let\u2019s assume Maintenance cost is .5% per year<\/li>\n<\/ul>\n
                          \n
                        • Cost of Capital is 5%<\/li>\n<\/ul>\n

                          Option 2- Widening Tullamarine Freeway (currently 4 lane to be extended to 6 lane one lane each direction)<\/p>\n

                          Assumption:-<\/p>\n

                          Land Requirement: So it is 13 KM and widening will require to acquire the side land of the Freeway which is again an open area and farm land only so acquiring land both sides by 13KM * 2 i.e. 26 + 10% additional as contingency<\/p>\n

                          Widening the road will increase the capacity to at least 35000 vehicles and which will reduce the Travel time by 40% at least i.e. by 15 Minutes\/Vehicle<\/p>\n

                          Let\u2019s assume the maintenance cost is 1% per annum<\/p>\n

                          Assumed cost of capital is 5%<\/p>\n

                          Trip cost includes tolls plus vehicle matching fees of $0.55 per trip on CityLink & $0.30 for EastLink. (Source: https:\/\/www.linkt.com.au\/melbourne\/using-toll-roads\/toll-calculator)<\/p>\n

                          Project Cost \u2013 Initial<\/strong><\/h3>\n\n\n\n\n\n\n\n\n\n\n\n
                          Options<\/td>\nOption 1( all cost in $)<\/td>\nOption 3( all cost in $)<\/td>\n<\/tr>\n
                          Description<\/td>\nRailway from Melbourne airport to Sunshine station<\/td>\nWidening Tullamarine Freeway<\/td>\n<\/tr>\n
                          Land Requirement<\/td>\n30 KMs<\/td>\n29 KMs<\/td>\n<\/tr>\n
                          Cost\/KM^2<\/td>\n400Million<\/td>\n400Million<\/td>\n<\/tr>\n
                          Land cost (Million)<\/td>\n12000<\/td>\n11600<\/td>\n<\/tr>\n
                          Construction cost \/KM<\/td>\n35Million\/KM<\/td>\n7 Million \/KM<\/td>\n<\/tr>\n
                          Total Construction Cost<\/td>\n900<\/td>\n182<\/td>\n<\/tr>\n
                          Total Cost (A +B)<\/td>\n12900<\/td>\n11782<\/td>\n<\/tr>\n
                          So Initial Cash Outlay<\/td>\n12900 Million<\/td>\n11782 Million<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

                           <\/p>\n

                          Calculation of Train Fare \/KM = Metro operates a train from Flinders Street to Brighton Beach every 20 minutes. Tickets cost $5 and the journey takes 23 min.<\/p>\n

                          Source:<\/p>\n

                          Lets\u2019 say fare for this trip will be fixed as $3\/ ticket<\/p>\n

                          No of passenger: – let\u2019s say 30% of the passengers will move to alternative option i.e trains which is 63000*30% = 18900 or let\u2019s say 20000<\/p>\n

                          Total Revenue Per day = 20000* $3<\/p>\n

                          Yearly revenue= 20000*3*365<\/p>\n

                          Option 2<\/p>\n

                          Cal ululation of Total No. of Trip:-<\/p>\n

                          As per case study = 63000 Vehicles \/Day<\/p>\n

                          No. of Days = 365<\/p>\n

                          Total Trips \/Annum = 63000*365 = 22995000<\/p>\n

                          30% of it = 6898500<\/p>\n

                          Toll Charges average \/day (for fast link) = $.30\/Trip<\/p>\n

                          (Let\u2019s assume 30% will use fast link)<\/p>\n

                          Cash Flow Forecasting for 10 Years<\/strong><\/h3>\n\n\n\n\n\n\n\n\n\n\n\n\n\n
                          Project -Option 1<\/td>\nWith 5% Discounting factor<\/td>\n<\/tr>\n
                          Particular<\/td>\nYear 0<\/td>\nYear 1<\/td>\nYear 2<\/td>\nYear 3<\/td>\nYear 4<\/td>\nYear 5<\/td>\nYear 6<\/td>\nYear 7<\/td>\nYear 8<\/td>\nYear 9<\/td>\nYear 10<\/td>\n<\/tr>\n
                          Initial Investment<\/td>\n-12900<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
                          Cash inflow – Fare collection<\/td>\n<\/td>\n21.9<\/td>\n21.9<\/td>\n21.9<\/td>\n21.9<\/td>\n21.9<\/td>\n21.9<\/td>\n21.9<\/td>\n21.9<\/td>\n21.9<\/td>\n21.9<\/td>\n<\/tr>\n
                          Less<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
                          Cash outflow- Maintenance @.5%<\/td>\n<\/td>\n-64.5<\/td>\n-64.5<\/td>\n-64.5<\/td>\n-64.5<\/td>\n-64.5<\/td>\n-64.5<\/td>\n-64.5<\/td>\n-64.5<\/td>\n-64.5<\/td>\n-64.5<\/td>\n<\/tr>\n
                          <\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
                          Net Cash inflow<\/td>\n-12900<\/td>\n-42.6<\/td>\n-42.6<\/td>\n-42.6<\/td>\n-42.6<\/td>\n-42.6<\/td>\n-42.6<\/td>\n-42.6<\/td>\n-42.6<\/td>\n-42.6<\/td>\n-42.6<\/td>\n<\/tr>\n
                          PVF @5%<\/td>\n0<\/td>\n0.9524<\/td>\n0.9070<\/td>\n0.8638<\/td>\n0.8227<\/td>\n0.7835<\/td>\n0.7835<\/td>\n0.7835<\/td>\n0.7835<\/td>\n0.7835<\/td>\n0.7835<\/td>\n<\/tr>\n
                          PV<\/td>\n-12900<\/td>\n-40.5714<\/td>\n-38.6395<\/td>\n-36.7995<\/td>\n-35.0471<\/td>\n-33.3782<\/td>\n-33.3782<\/td>\n-33.3782<\/td>\n-33.3782<\/td>\n-33.3782<\/td>\n-33.3782<\/td>\n<\/tr>\n
                          NPV<\/td>\n-14085.8<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

                           <\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
                          Project Option 3<\/td>\nWith 5% Discounting factor<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
                          <\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
                          Particular<\/td>\nYear 0<\/td>\nYear 1<\/td>\nYear 2<\/td>\nYear 3<\/td>\nYear 4<\/td>\nYear 5<\/td>\nYear 6<\/td>\nYear 7<\/td>\nYear 8<\/td>\nYear 9<\/td>\nYear 10<\/td>\n<\/tr>\n
                          Initial Investment<\/td>\n-11782<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
                          Cash inflow -toll collection @ .30 \/ Trip<\/td>\n<\/td>\n2.06955<\/td>\n2.06955<\/td>\n2.06955<\/td>\n2.06955<\/td>\n2.06955<\/td>\n2.06955<\/td>\n2.06955<\/td>\n2.06955<\/td>\n2.06955<\/td>\n2.06955<\/td>\n<\/tr>\n
                          Less<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
                          Cash outflow- Maintenance @1%<\/td>\n<\/td>\n-117.82<\/td>\n-117.82<\/td>\n-117.82<\/td>\n-117.82<\/td>\n-117.82<\/td>\n-117.82<\/td>\n-117.82<\/td>\n-117.82<\/td>\n-117.82<\/td>\n-117.82<\/td>\n<\/tr>\n
                          <\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
                          Net Cash inflow<\/td>\n-11782<\/td>\n-115.75<\/td>\n-115.75<\/td>\n-115.75<\/td>\n-115.75<\/td>\n-115.75<\/td>\n-115.75<\/td>\n-115.75<\/td>\n-115.75<\/td>\n-115.75<\/td>\n-115.75<\/td>\n<\/tr>\n
                          PVF @5%<\/td>\n0<\/td>\n0.9524<\/td>\n0.9070<\/td>\n0.8638<\/td>\n0.8227<\/td>\n0.7835<\/td>\n0.7835<\/td>\n0.7835<\/td>\n0.7835<\/td>\n0.7835<\/td>\n0.7835<\/td>\n<\/tr>\n
                          PV<\/td>\n-11782<\/td>\n-110.239<\/td>\n-104.989<\/td>\n-99.9896<\/td>\n-95.2282<\/td>\n-90.6935<\/td>\n-90.6935<\/td>\n-90.6935<\/td>\n-90.6935<\/td>\n-90.6935<\/td>\n-90.6935<\/td>\n<\/tr>\n
                          NPV<\/td>\n-15003.9<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

                           <\/p>\n

                          Cash flow projections for the 35 year life cycle is projected in the excel attached.<\/p>\n

                          Analysis of Tullamarine Freeway Analysis<\/strong><\/h3>\n

                          As this is a infrastructure project so financial perspective direct profitability is not expected , only thing is which option will required less investment and further cash outflow to continue the operations and will also give maximum benefit in the future from that angle Option 1 is better as there is very small difference in terms of initial cost but yearly cost in future and revenue generated every year is 10 times from option 2 i.e. option 1 toll collection is only 2.1 whereas the fare collection is 21.9, and NPV for whole life of the period for both the options option 1 will be less negative.<\/p>\n