4. The government has undertaken a highway project that was originally projected to cost $1 billion and provide benefits of $1.5 billion. Unfortunately, the costs have been much higher than anticipated. The government has spent $1.2 billion so far and now expects it will cost an additional $1.2 billion to finish the project. Should the project be abandoned or completed?

Question

Business

Guest

16 December, 15:27

4. The government has undertaken a highway project that was originally projected to cost $1 billion and provide benefits of $1.5 billion. Unfortunately, the costs have been much higher than anticipated. The government has spent $1.2 billion so far and now expects it will cost an additional $1.2 billion to finish the project. Should the project be abandoned or completed?

+5

Answers (1)

Know the Answer?

Konner Vaughan · Answer 1

Abandon the project.

Explanation:

Abandoning the project is viable option because as there is no profit, so $1.2 billion of government will be at loss.