Contemporary Engineering Economics (6th Edition)
6th Edition
ISBN: 9780134105598
Author: Chan S. Park
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Question
Chapter 6, Problem 27P
To determine
Calculate the cost per mile.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
A construction manager just starting in private practice needs a van to carry crew and equipment. She can lease a used van for $3,867 per year, paid at the beginning of each year, in which case maintenance is provied. Alternatively, she can buy a used van for $6,427 and pay for maintenance herself. She expects to keep the van for three years at which time she could sell it for $1,251. What is the most she should pay for uniform annual maintenance to make it worthwhile to buy the van instead of leasing it, if her MARR is 20%?
A construction manager just starting in private practice needs a van to carry crew and equipment. She can lease a used van for $3,938 per year, paid at the beginning of each year, in which
case maintenance is provied. Alternatively, she can buy a used van for $5,473 and pay for maintenance herself. She expects to keep the van for three years at which time she could sell it
for $1,139. What is the most she should pay for uniform annual maintenance to make it worthwhile to buy the van instead of leasing it, if her MARR is 20%?
Enter your answer as follow: 123456
Ottis, Inc., uses 640,000 plastic housing units each year in its production of paper shredders. The cost of placing an order is $30. The cost of holding one unit of inventory for one year is $15.00. Currently, Ottis places 160 orders of 4,000 plastic housing units per year.
Compute the economic order quantity.
Compute the ordering, carrying, and total costs for the EOQ.
How much money does using the EOQ policy save the company over the policy of purchasing 4,000 plastic housing units per order?
Chapter 6 Solutions
Contemporary Engineering Economics (6th Edition)
Ch. 6 - Prob. 1PCh. 6 - Prob. 2PCh. 6 - Prob. 3PCh. 6 - Prob. 4PCh. 6 - Prob. 5PCh. 6 - Prob. 6PCh. 6 - Consider the cash flows in Table P6.7 for the...Ch. 6 - Prob. 8PCh. 6 - Prob. 9PCh. 6 - The repeating cash flows for a certain project are...
Ch. 6 - Beginning next year, a foundation will support an...Ch. 6 - Prob. 12PCh. 6 - Prob. 13PCh. 6 - Prob. 14PCh. 6 - Prob. 15PCh. 6 - Prob. 16PCh. 6 - Prob. 17PCh. 6 - Prob. 18PCh. 6 - The Geo-Star Manufacturing Company is considering...Ch. 6 - Prob. 20PCh. 6 - Prob. 21PCh. 6 - Prob. 22PCh. 6 - Prob. 23PCh. 6 - Prob. 24PCh. 6 - Prob. 25PCh. 6 - Prob. 26PCh. 6 - Prob. 27PCh. 6 - Prob. 28PCh. 6 - Prob. 29PCh. 6 - Prob. 30PCh. 6 - Prob. 31PCh. 6 - Prob. 32PCh. 6 - Prob. 33PCh. 6 - Prob. 34PCh. 6 - Prob. 35PCh. 6 - Prob. 36PCh. 6 - Prob. 37PCh. 6 - Prob. 38PCh. 6 - Prob. 39PCh. 6 - Prob. 40PCh. 6 - Prob. 41PCh. 6 - Prob. 42PCh. 6 - Prob. 43PCh. 6 - Prob. 44PCh. 6 - Prob. 45PCh. 6 - Prob. 46PCh. 6 - Prob. 47PCh. 6 - Prob. 48PCh. 6 - Prob. 49PCh. 6 - Prob. 50PCh. 6 - Prob. 51PCh. 6 - Prob. 52PCh. 6 - Prob. 53PCh. 6 - Prob. 1STCh. 6 - Prob. 2STCh. 6 - Prob. 3STCh. 6 - Prob. 4ST
Knowledge Booster
Similar questions
- A company is developing a new electronic product. It expects to spend $38 million on Research and Development and then another $6 million on Manufacturing Engineering. After completing all this, the company expects a cost of $15 per unit to manufacture and plans to build in a profit of $5 per unit into the price. The company needs to recover the cost of R&D plus Manufacturing Engineering over five years through sales of 4 million units over those five years. What will the company need to establish as the sales price for the unit?arrow_forwardA manufacturing company leases a building for $100,000 per year for its manufacturing facilities. In addition, the machinery in this building is being paid for in installments of $20,000 per year. Each unit of the product produced costs $15 in labor and $10 in materials. The product can be sold for $40. Use this information to solve, If the selling price is lowered to $35 per unit, how many units must be sold each year for the company to earn a profit of $60,000 per year? (a) 12,000 (b) 10,000 (c) 16,000 (d) 18,000 (e) 5,143. Select the closest answer.arrow_forwardI’m having trouble solving these two parts to the question. How do you arrive at the answer you do? Thanks!arrow_forward
- Kabir’s Ceramics spent 3000 Taka on a new kiln last year, in the belief that it would cut energy usage 25% over the old kiln. This kiln is an oven that turns “green ware” into finished pottery. Kabir is concerned that the new kiln requires extra labour hours for its operation. Kabir wants to check the energy savings of the new oven and also to look at other measures of their productivity to see if the change really was beneficial. Kabir has the following data to work with: Last Year This year Production (finished units) 4 000 No change Green ware(kgs) 5 000 5 000 Labour (hours) 350 300 Capital (MU) 15 000 3000 Taka more than last year Energy (kWh) 4 000 25 % less than last year 1.Analyse the productivity percentage change for Labour, Capital and Energy and justify the whether the investment decisions (you agree or not )arrow_forwardJake’s Shipping, Inc. needs to purchase a new fleet of light trucks for its shipping business. The firm is trying to decide whether to purchase trucks with diesel engines or trucks with gasoline engines. The diesel truck will have a useful life of 12 years, after which it will need to be replaced. The diesel truck costs $110,000 to purchase and its annual maintenance and operation costs will depend on the cost of regular maintenance/repairs and the cost of diesel fuel. In Years 1 through 5, its annual maintenance/repair costs are expected to be $2000 per year. In Years 6 through 12, its annual maintenance/repair costs are expected to be $2500 per year. The firm expects that the diesel truck will use 5,900 gallons of diesel fuel per year (Years 1 through 12) and believes that diesel fuel will cost $2.65 per gallon, on average, during the life of the truck. The gasoline truck only costs $60,000 to purchase but will have a useful life of only 4 years, after which it will need to be…arrow_forwardIn the fall, Jay Thompson decided to live in a university dormitory. He signed a dorm contract under which he was obligated to pay the room rent for the full college year. One clause stated that if he moved out during the year, he could sell his dorm contract to another student who would move into the dormitory as his replacement. The dorm cost was $6300 for the two semesters, which Jay had already paid. A month after he moved into the dorm, he decided he would prefer to live in an apartment. That week, after some searching for a replacement to fulfill his dorm contract, Jay had two offers. One student offered to move in immediately and to pay Jay $500 per month for the seven remaining months of the school year. A second student offered to move in the second semester and pay $2800 to Jay. Jay estimates his food cost per month is $350 if he lives in the dorm and $300 if he lives in an apartment with three other students. His share of the apartment rent and utilities will be $450 per…arrow_forward
- Aoife has been working as a nurse in the local public hospital and earning an annual salary of €40,000. Due to increasing property prices, she decides to set up her own estate agency business. Aoife’s business expenses in the first year will include a €16,000 salary for a part-time administrator, €1,000 for various supplies, €3,000 in advertising and €5,000 to rent an office. For the rent, Aoife will use her own savings on which she was earning interest of 5% annually. Aoife is paid the difference between revenue and business expenses. Aoife’s implicit cost in the first year of setting up her own business is €16,000 €24,250 €40,000 €40,250 €75,000 What revenue would Aoife’s business have to earn in the first year in order for Aoife to be better off by €30,000relative to working as a nurse? €70,250 €95,250 €102,500 €55,000 €95,000arrow_forwardCindy and Steven are recently married and are both chefs. They have recently graduated from culinary school and are making a starting salary of $15.00 as a sous-chef. They both work 10 hour days, six days a week. Because they are chefs at a mid- level restaurant they live in the downtown core where it is located. The rent on their one bedroom apartment is $1125/month. This includes all utilities. However, they pay an additional $75 for cable and internet. Their joint cell phone bill is $60.00 and they opt not to have a landline to save money. Because they live downtown they have also chosen not to buy a car and spend about $200 a month on public transportation. They eat most meals for free at the restaurant where they work so their grocer bill is only about $200 a month. Do Cindy and Steven earn enough money to cover their expensesarrow_forwardThe last box please.arrow_forward
- The current yearly tuition fee for your university is $240,000. If you parents made a lumpsum investment 18 years ago which earned interest of 6.5%, how much did they invest to be able to pay tuition this year?arrow_forwardTanim quits his engineering job, where he was earning a salary of $70,000 per year, to start his own computer software business. He owns a building and was renting out for $20,000 per year. Tanim hires a new building for his company and pays a non-refundable advance fee of $10,000 today. Later on, after a few days, he decides to go back to his own building and for that he cancels his contract with his tenant. Find the sunk cost associated with Tanim's computer software business. There is no sunk cost It is $20,000 It is $10,000 It is $30,000 Which one is correct?arrow_forwardAfter spending $10 million on research and development, the company Patronus, Inc. rolled out a new heat-sensing home alarm system called "Thermo-Shield." Patronus has made $8 million in direct sales of "Thermo-Shield" materials to customers via their website, and $12 million in sales to the home building firm D.R. Horton that will provide the alarm system as a standard part of the new houses they are building. Also, while the alarm installation company Guardian Services does not carry "Thermo-Shield" to sel, they will install "Thermo-Shield" systems that homeowners already purchased. So far, Home Depot has recorded $2,500,000 in installation service sales putting in "Thermo-Shield" systems. Based on this information, the "Thermo-Shield" product has increased GDP by which amount? $20.5 million $24.5 million O $32.5 million $30 millionarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Managerial Economics: Applications, Strategies an...EconomicsISBN:9781305506381Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. HarrisPublisher:Cengage Learning
Managerial Economics: Applications, Strategies an...
Economics
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:Cengage Learning