Suppose that the price of a barrel of oil is $80 and interest rates remain at 8%. If a new technology is implemented in one of the wells and it costs $3,000,000. Calculated the estimated "profit" from outfitting one of our wells with this new technology.

Suppose that the price of a barrel of oil is $80 and interest rates remain at 8%. If a new technology is implemented in one of the wells and it costs $3,000,000. Calculated the estimated "profit" from outfitting one of our wells with this new technology.

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

Antoine rents rooms in his hotel for an average of $100 per night. The variable cost per rented room is $20, to cover maid service and utilities. His fixed costs are $100,000 and his profit last year was $20,000. For Antoine, the contribution per unit is $100 $80 $1005 $800
A New York renewable energy company pays $0.18 per kilowatthour (kWh) for the first 10,000 units of electricity each month and $0.15/kWh for all remaining units. If a firm uses 25,000 kWh/month, what is its average and marginal cost?
A business has the following costs: Rent: (none, the owner owns the building. Similar stores rent for $5000 a month) Workers: $10000 a month Owner salary: none. The owner simply takes profits away and has no official salary. He could make $6000 a month if he worked somewhere else NOTE: KEEP YOUR CALCULATIONS. THIS INFORMATION WILL BE USED FOR MULTIPLE QUESTIONS What are the ECONOMIC profits of this business if revenues are $20000 a month? Question 2 options: 5000 10000 -1000 4000
7.4
Please explain each process and show your work
Problem 6Cannes Croissants (not a real company) wishes to determine the optimum production quantity for its topselling product, almond croissants. The annual demandfor almond croissants is 12,000 units. The setup costs fora production run of the croissants is US$15. The holdingcost per unit per year is US$0.50. Production is mostefficient when 80 croissants are produced per day. Thecompany operates 300 days during a year.a What is the economic production quantity (EPQ)?b How many production runs will there by per year?c What is the maximum inventory level?d What is the total annual cost (in US dollars)?e What is the length of a production run in days?
Give an example of the Equivalent Annual Operating Cost?
Biwei decides to set up a small business in NYC. The start-up cost is $1000 for a license and the estimated direct cost is $4 per output. After one year, Biwei’s business becomes profitable. Sonia plans to enter the same business in thesame area. What would be the cost facing Sonia? Does she bear the same cost as Biwei?
What does it mean when recyclers gather containers until their marginal costs are equal to the container’s respective redemption prices?
If he wants the average cost of production to be $1, how many lures would he e) have to produce in one month? e)_ If he wants to make a profit of at least $4000 per month, what is the f) minimum number of lures he would have to produce if he sells every lure he produces for $4? f)_
If the firm chooses a single, profit maximizing price, how manyunits will it sell?
"A taxi company currently has nine cabs in its fleet, and its total daily cost is $4,000. If the company added a 10th cab, its daily total cost would be $4,200, or $420 per cab. Adding the 10th cab will increase the daily total revenue by $300. Should the company add the 10th cab? (Yes/No)"