An engineer must decide between two ways to pump concrete to the top of a seven-story building. Plan 1 requires the leasing of equipment for $60,000 initially and will cost between $0.40 and $0.95 per metric ton to operate, with a most likely cost of $0.50 per metric ton. The pumper can pump 100 metric tons per 8-hour day. If leased, the asset will have a contract period of 5 years. Plan 2 is a rental option that will cost $17,000 per year. In addition, an extra $13.5 per hour labor cost will be incurred for operating the rented equipment per 8-hour day. Which plan should the engineer recommend if the equipment will be needed for 90 days per year? The MARR is 12% per year.

An engineer must decide between two ways to pump concrete to the top of a seven-story building. Plan 1 requires the leasing of equipment for $60,000 initially and will cost between $0.40 and $0.95 per metric ton to operate, with a most likely cost of $0.50 per metric ton. The pumper can pump 100 metric tons per 8-hour day. If leased, the asset will have a contract period of 5 years. Plan 2 is a rental option that will cost $17,000 per year. In addition, an extra $13.5 per hour labor cost will be incurred for operating the rented equipment per 8-hour day. Which plan should the engineer recommend if the equipment will be needed for 90 days per year? The MARR is 12% per year.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

Why Do We Need to Use Cash Flows in Economic Analysis?
Why do some frozen pizzas cost more than others? Think generic versus name brand. Why would a customer opt to purchase a name brand pizza over a generic brand?
Why do you think technology is important in your studies?
How do economic engineers make typical personal decisions?
Evaluate the key marketing issues and their implications.
Hand written solutions are strictly prohibited
compare and contrast Mom's Touch and Burger King Contrast food quality, service, facilities, cost, convenience, business model, cleanliness, location 1700 words
What are the pros and cons of online learning?
Discuss the principles of individual decision making with examples
Give typing answer with explanation and conclusion what type of charity work does Ford Motor Company do? What drives them?
Please do not give solution in image format thanku