An area on the Colorado River is subject to periodic flooddamage that? occurs, on the? average, every two years? (i.e.,probability of flooding in any year is? 0.5) and results in a$2,200,000 loss. It has been proposed that the river channel beimproved by straightening and deepening it at a cost of$2,400,000?,to reduce the annual probability of flooding to 0.364??during aperiod of 18 years before it would have to be deepened again. Thisprocedure would also involve annual expenditures of $90,000 forminimal maintenance.

????????????One legislator in the area has proposed that abetter solution would be to construct a? flood-control dam at acost of $8,000,000?, which would last? indefinitely, with annualmaintenance costs of not over $50,000.

She estimates that this project would reduce the annualprobability of flooding to 0.205. In? addition, this solution wouldprovide a substantial amount of irrigation water that would produceannual revenue of ?$150,000

and recreational? facilities, which she estimates would be worthat least $45,000 per year to the adjacent populace.

????????????If the? state's capital is worth 11?%, perform? B-Canalysis and recommend the proposal to be adopted. Note that one ofthe two proposals must be? adopted, as the? do-nothing alternativewill not be accepted by the? legislature, no matter what theanalysis shows. This means that only the incremental analysisbetween the two proposals need be done.

The? B-C ratio for the? "Improve channel" proposal is ______?(Round to 2 decimal places?)

The? B-C ratio for the? "Construct dam" proposal is ________?(Round to 2 decimal places?)

The incremental? B-C ratio of? "Construct dam" vs.? "Improvechannel" is _____ ?(Round to 2 decimal places?)

?Therefore, the recommended proposal is to

A.Improve the channel

B.Construct Dam