Define optimism bias and explain how and why it arises
Top of Class
Get An A+ Paper
Get Started
Define optimism bias and explain how and why it arises
Order 100% Plagiarism Free Paper Now
Define optimism bias and explain how and why it arises. The coursework has 4 equally weighted questions. All questions must be answered. Question 1 (25%) Cost Benefit Analysis in Practice
You are asked to estimate the Net Present Value of a scheme to build a road to bypass a village.
This exercise is based on a number of simplifying assumptions, some of which are provided below,
some of which you will have to make. Where you are asked to make an assumption or find
information make sure it is properly referenced and from a reliable and appropriate source.
For this exercise the base year is 2020 and all costs are at 2010 values. Assume a discount rate of
3.5% and an operational scheme lifetime of 30 years. You are given the following information:
The current number of vehicle journeys is 6,500,000 per annum. This is set to increase in the
absence of the new road by: 0.5% each year for the foreseeable future. If the road is built the
resulting increase in demand is forecast to be 1% each year again for the foreseeable future.
ENG3208 Engineering Sustainable Transport
Order 100% Plagiarism Free Paper Now
The capital cost of the scheme is £35 million.
You are required to explain each step in the process.
For some parts of the question you will need to extract data from the TAG Data Book, make sure you
use the most current version: May 2019 v1.12 (as the expected November update did not take
place)
https://www.gov.uk/government/publications/tag-data-book
However, you are not being asked to follow the detailed TAG methodology – this is a simplified
exercise.
1(a) Preparing data for analysis
(i) Scheme costs
The capital cost is spread over two years:
2020 £20,000,000
2021 £15,000,000
Price changes in the construction sector are assumed to be the same as the rest of the economy.
The costs have already been adjusted for risk.
Adjust the costs for optimism bias.
| (ii) | Vehicles that transfer from the existing road to the new road will save 3 minutes in travel time, on average. |
Use table A1.3.5 from the TAG data book to obtain values of time per vehicle hour. You will then
need to make some assumptions about the shares of different vehicle types using the bypass – look
at Transport Statistics Great Britain.
Once you have estimated the proportions of vehicles by vehicle type, you may make the simplifying
assumption that these remain fixed for the scheme life and estimate a weighted average value of
time. Then estimate the value of travel time saved for existing and new users.
| (iii) | The scheme will have an impact on the number of traffic collisions. The forecasts are shown below: |
Table 1 Traffic collisions with and without the bypass1
| Number collisions | Annual average without by pass |
Annual average with by-pass |
| Fatal | 0.5 | 0 |
| Serious | 1.1 | 0.2 |
| Slight | 3.6 | 0.9 |
| Damage only | 10 | 2.5 |
1As collisions are rare events these figures on based on averages over a five year period and so are
not always whole numbers.
Define optimism bias and explain how and why it arises
Order 100% Plagiarism Free Paper Now
Value the reduction in collisions using TAG values. You may then assume these remain constant
each year for the scheme life.
1(b) Estimate the Net Present Value of the scheme using the information on costs and benefits
provided above. Explain the process and any assumptions made. On the basis of your findings and
considering any omitted costs and benefits should the scheme go ahead?
You may assume constant values throughout.
Include a copy of the main excel spreadsheet (in original or tabular form) in the main body of your
answer (the spreadsheet itself should be submitted separately).
Question 2 (25%) Megaprojects in transport
2(a) Define optimism bias and explain how and why it arises – with evidence on the scale and scope
of the problem and mitigation measures.
2(b) Consider the case for and against High Speed 2 and why the Government has decided to
proceed with the construction. Do you agree with this outcome? Draw on evidence from High Sped
2 and other relevant projects.
Question 3 (25%) Road transport
3(a) Define the levels of autonomy in road vehicles and provide examples of the technology and its
application at each level.
3(b) Consider the range of potential impacts of autonomous vehicles in terms of sustainability and
accessibility. Use the evidence to draw conclusions on whether the net effect is likely to be positive
or negative.
Question 4 (25%) Sustainable transport systems
4. The current pandemic has led to constraints and disruption to transportation systems. Consider
the evidence on the benefits that have arisen from this. Is it possible to secure some of these
benefits in the long run? How might this happen?
ENG3208 Engineering Sustainable Transport
Order 100% Plagiarism Free Paper Now
Submission
You must submit the work on SurreyLearn in two files:
• A pdf file with the main body of the work
• An excel spreadsheet containing the NPV calculation for Q1.
Marking criteria
The paper must show citations and be well referenced. The paper must show a complete list of
references in the Harvard style.
Note – In addition to the course unit material, students are expected to read and research beyond
the course unit materials in order to provide evidence and appropriate references to support,
illustrate and underpin their discussions and proposals.
The work will be marked according to the Level 6 Grade Descriptors of the University of Surrey and
will use the following mark break down.
Guide length 4000 to 5000 words excluding tables, spreadsheet and reference list.
Remember that this is an individual piece of work.
Abigail Bristow
April 2020
Assessment criteria to be used in conjunction with grade descriptors.
| Question and Part | Marks allocation |
Comments |
| 1(a) Appropriate and accurate calculations and assumptions where required. Citation of sources |
10% | |
| 1(b) Complete and correct cost benefit analysis Full and concise explanation. Coverage of impacts in context. Conclusion based on evidence. Appropriate use of references. |
15% | |
| 2(a) Clear and succinct definition; use of evidence to demonstrate issues. Appropriate use of references. |
10% | |
| 2(b) Use of evidence to make the case. Make comparisons. Conclusion based on evidence. Appropriate use of references. |
15% |
| 3(a) Complete, accurate and succinct definitions with appropriate examples. Appropriate use of references |
10% |
| 3(b) Use of evidence to consider the full range of effects and any actions required. Appropriate use of references. |
15% |
| 4. Build arguments using evidence. Use of reputable and properly cited contemporary sources to evidence effects. Use of academic sources to consider longer term solutions/changes. Appropriate use of references. |
25% |
Feedback
You will receive feedback in the following form.
Detailed annotation of scripts.
Completed assessment sheet.