Economic Feasibility Evaluation of Government Investment Project by Using Cost Benefit Analysis: A Case Study of Domestic Port (Port A)

DOI: 10.5176/2251-2012_QQE35

Authors: Nantarat Tangvitoontham and Papusson Chaiwat

Abstract:

This paper aim to evaluate costs and benefits of the Domestic Port A Project, Lame Chabang Port, Chonburi Provinceby using Cost-Benefit Analysis Approach (CBA). The approach can provides support for informed judgment and decision making about the merit of the Project. Moreover, the evaluation criteria can be presented in three traditional forms: Net Present Value (NPV),Benefit-Cost Ratio (B/C ratio) and Economic Internal Rate of Return (EIRR), in order to appraising the worthiness of the project.The study also defines all potential costs and benefits. Consequently,the net present value (NPV) of the project is 618.705 million baht.Economic Internal Rate of Return (EIRR) equals 16.81{6e6090cdd558c53a8bc18225ef4499fead9160abd3419ad4f137e902b483c465} and benefit-cost ratio (B/C) is 1.27. The results indicate that the Domestic Port A is worth to invest. However, the sensitivity analysis shows that the Project may be at risk if any unexpected circumstances will be happened.

Keywords: Cost benefit analysis; feasibility analysis, economicsevaluation

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