Capacity benefit margin（CBM） is evaluated and optimized via an iterative method based on a presumed generation reliability level when the available transfer capability（ATC） is calculated. Based on the generation reliability exponential analytic model of interconnected areas presented in the first part， three models are developed in consideration of the reserve capacity， tie line transfer capability and reserve price. The sequential quadratic programming（SQP） is used to solve the CBM of transmission lines corresponding to different reliability levels. Since it is an analytic model， reliability indices can be calculated quickly without any iteration. The coupling effects between different areas are also considered. Test results on TH-RTS indicate the precision and effectiveness of the model proposed.