A 23,000 square foot warehouse was just constructed for $700,000. If the cost-capacity factor is 0.82 , what is the estimated cost to construct a 35,000 square foot warehouse? The estimated cost to construct a 35,000 square foot warehouse is $. (Round to the nearest dollar.)

Advanced Engineering Mathematics
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ISBN:9780470458365
Author:Erwin Kreyszig
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A 23,000 square foot warehouse was just constructed for $700,000. If the cost-capacity factor is 0.82 , what is the estimated cost to construct a 35,000 square foot warehouse? The estimated cost to construct a 35,000 square foot warehouse is $. (Round to the nearest dollar.) 

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Step 1: Basic details

The cost to capacity method is used when an organization wants to expand its business and aims to do significant capital expenditure. Using this method helps to ascertain the cost of a new facility.

It is calculated as:

C subscript 2 over C subscript 1 equals open parentheses Q subscript 2 over Q subscript 1 close parentheses to the power of x

Here, C2 denotes the expected cost of the new facility

C1 denotes the cost of the existing facility

Q2 denotes the area of the expected new facility

Q1 denotes the area of current facility

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