Ski Boards, Inc., wants to enter the market quickly with a new finish on its ski boards. It has three choices: a) refurbish the old equipment at a cost of $250, b) make major modifications at the cost of $1,000, or c) purchase new equipment at a net cost of $1,750. f the firm chooses to refurbish the equipment, materials and labor will be $1.10 per board. If it chooses to make modifications, materials and labor will be $0.80 per board. If it buys new equipment, variable costs are estimated to be $0.40 per board. a) On the graph to the right, use the line drawing tool to draw the total cost curve for each option. Label the curves TC. TC, and TC, respectively. Note: Carefully follow the instructions above and only draw the required objects. lick the graph, choose a tool in the palette and follow the instructions to create your graph. Dollars 8.000 7,500- 7,000 6.500 6,000 5,500 5,000 4,500- 4,000 3,500 3,000 2.500 2.000 1,500 1,000 500- of 1.000 2,000 3,000 Boards 4,000 5.000

Ski Boards, Inc., wants to enter the market quickly with a new finish on its ski boards. It has three choices: a) refurbish the old equipment at a cost of $250, b) make major modifications at the cost of $1,000, or c) purchase new equipment at a net cost of $1,750. f the firm chooses to refurbish the equipment, materials and labor will be $1.10 per board. If it chooses to make modifications, materials and labor will be $0.80 per board. If it buys new equipment, variable costs are estimated to be $0.40 per board. a) On the graph to the right, use the line drawing tool to draw the total cost curve for each option. Label the curves TC. TC, and TC, respectively. Note: Carefully follow the instructions above and only draw the required objects. lick the graph, choose a tool in the palette and follow the instructions to create your graph. Dollars 8.000 7,500- 7,000 6.500 6,000 5,500 5,000 4,500- 4,000 3,500 3,000 2.500 2.000 1,500 1,000 500- of 1.000 2,000 3,000 Boards 4,000 5.000

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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