Essay Title: 

Business Finance

March 24, 2016 | Author: | Posted in finance, mathematics and economics

SEQ CHAPTER \h \r 1 Business Finance Project

THREE GORGES DAM

As one of the most well-managed private companies , the Chinese government has delegated us the task to build what would probably become the world ‘s largest hydro project – the Three Gorges Dam . This won ‘t be just a simple project , as a lot of uncertainties and good /bad factors pertaining to its profitability are involved . We would need to carefully examine all the financial aspects affecting our company to be able to decide if this project is generally worth undertaking p [banner_entry_middle]

The Three Gorges Dam project will be built along the banks of the Yangtze River . This won ‘t be the tallest nor the widest dam in the world but it ‘d be the largest hydroelectric project yet . Currently , China is generating 70 of their of the biggest contributor to air pollution and the greenhouse effect With the construction of this Three Gorges Dam , the Chinese would be able to greatly minimize this serious environmental problem while also addressing their current power shortages . Another major advantage for constructing this dam is for flood control . The region by the Yangtze River is known for its frequent and severe floods killing thousands of people and destroying millions worth of agricultural produce and other properties . The project is also expected to bring about improvements in navigation and water commerce which would eventually lead to a decrease in shipping costs by as much as 35

However , with the above advantages given , there are also several inevitable major tradeoffs that should be considered . Obviously , the construction cost is one . The Three Gorges Dam would be using the latest technology and best materials to be able to meet expected results . This would surely cost us much . Another major consideration would be the resettlement of millions of people . The dam will create a large water reservoir which is estimated to 140 towns and 326 peasant villages . The construction of the dam also means losses in arable land and rich fisheries by the river . Also , a lot of historical and archaeological places would have to be destroyed generating additional government losses on tourism . These sites are considered to be the cradles of Chinese civilization and are important in understanding Chinese history . The dam would take years to construct and therefore , operation and maintenance cost , which is definitely costly , is another huge consideration . Other costs associated with the ongoing construction of the dam such as accident costs and the downstream effect or the cost associated with the downstream pollution must also be considered

Being a private institution , we ‘re not greatly concerned with the broad public benefits as much as the profits this Three Gorges Dam would bring us . Also , we would have to give careful considerations to the associated expenses . Unlike the government , we have very limited available funds For us , a project is viable only if it ‘d be able to give us a positive net present value . We must understand that every aspect of the dam… [banner_entry_footer]

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