A project to be started at the end of 2010 will require the following materials. Their current unit prices are shown for end-of-year 2007. Their expected inflation rates per year are also shown. What is the estimated future cost of this project in actual dollars assuming unit prices at the end-of-year 2010? a. $30K b. $40K d. $60K e. $70K Prices at EOY 2007 $33 per cubic yard $7 per linear foot $15 per linear foot Material Concrete Wood Steel Amount Needed 1500 cubic yards 1000 linear feet 500 linear feet c. $50K Inflation Rates 3.3% per year 2.3% per year 1.8% per year

A project to be started at the end of 2010 will require the following materials. Their current unit prices are shown for end-of-year 2007. Their expected inflation rates per year are also shown. What is the estimated future cost of this project in actual dollars assuming unit prices at the end-of-year 2010? a. $30K b. $40K d. $60K e. $70K Prices at EOY 2007 $33 per cubic yard $7 per linear foot $15 per linear foot Material Concrete Wood Steel Amount Needed 1500 cubic yards 1000 linear feet 500 linear feet c. $50K Inflation Rates 3.3% per year 2.3% per year 1.8% per year

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Output (unit) Total cost (RM) Total fixed cost (RM) Total variable cost (RM) Average fixed cost (RM) Average variable cost (RM) Average total cost (RM) Marginal cost (RM) 0 600 600 - - - - - 10 1050 600 450 60 45 105 45 20 1450 600 850 30 42.5 72.5 40 30 1800 600 1200 20 40 60 35 40 2100 600 1500 15 37.5 52.5 30 50 2450 600 1850 12 37 49 350 60 2850 600 2250 10 37.5 47.5 40 70 3300 600 2700 8.57 38.57 47.14 45 80 3850 600 3250 7.5 40.625 48.125 55 90 4500 600 3900 6.67 43.34 50 65 100 5250 600 4650 6 46.5 52.5 75 Which time period is the firm operating? Why?
Bags/Participants Fixed Cost Variable Cost Total Cost 0 $1,700 $ - $1,700 100 $1,700 $500 $2,200 200 $1,700 $1,200 $2,900 300 $1,700 $2,700 $4,400 400 $1,700 $5,200 $6,900 500 $1,700 $9,000 $10,700 600 $1,700 $15,000 $16,700 700 $1,700 $23,800 $25,500 800 $1,700 $36,800 $38,500 900 $1,700 $55,800 $57,500 1,000 $1,700 $83,000 $84,700 Given the above information on cost, if you charge $15 per entry, what is the breakeven quantity of bags that you should order? At what quantity of bags will profits be maximized? A Use the profit maximizing rule, MR ≥ MC, buy 300 bags. B Use the profit maximizing rule, MR ≥ MC, buy 200 bags. C Use Qb = F/(MR-AVC) where Qb is the breakeven quantity to be determined, the optimal quantity of bags is 300. D Use Qb = F/(MR-AVC) where Qb is the breakeven quantity to be determined, the optimal quantity of bags is 200.
Billco had a total cost of $10,000 when it sold 200 units. It had a total cost of $14,000 when it sold 250 units. What was Billco's average total cost when it sold 250 units?
Price and cost (dollars per client) 100.00 90.00 MC 80.00 ATC 70.00 60.00 50.00 40.00 30.00 20.00 10.00 D MR + 4 8 10 Quantity (clients per day) 2.