Answered: 5. Given the following cost…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Transcribed Image Text:5. Given the following cost expenditures (see Table P6.3) for a small bridge job to include direct and indirect charges (but not bank interest): A. Calculate the peak financial requirement. B. Sketch a diagram of the overdraft profile. Assumptions: • The markup for this project is 8%. Finance charge is 1% per month. REVIEW QUESTIONS AND EXERCISES 157 TABLE P6.2 Project Bar Chart Month Activity 1 3. 4 1. Survey $2,000 2. Mobilization $1,200 3. Trench $3,000 $6,000 4. Lay pipe $3,000 5. Concrete $500 $500 6. Backfill $500 7. Move out $500 8. Prepare valves $1,000 9. Install valves S1,000 10. Test $1,500 Retainage is 6% throughout project. Payments are billed at the end of the month, and are received one month later. TABLE P6.3 Monthly Costs for Bridge Job Month 1 2 3 Monthly cost* 29,000 48,900 16,400 * Direct cost + indirect cost

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