e following data shows the different sizes of pipes which a company wishes to use as a replacement for the old pipe system that they are using. Diameter 100mm Cost of Pipe-P1800000 Annual Maintenance Cost-P88000 Operating cost/hour=P480 Diameter 150mm Cost of Pipe-Pl 120000 Annual Maintenance Cost-Pl 36000 Operating cost/hour=P500 Diameter 250mm Cost of Pipe-Pl 000000 Annual Maintenance Cost-P60000 Operating cost/hour=P620 Total number of operating hours per year 500 Replacement is done every 10 years Money is worth 10% annually
e following data shows the different sizes of pipes which a company wishes to use as a replacement for the old pipe system that they are using. Diameter 100mm Cost of Pipe-P1800000 Annual Maintenance Cost-P88000 Operating cost/hour=P480 Diameter 150mm Cost of Pipe-Pl 120000 Annual Maintenance Cost-Pl 36000 Operating cost/hour=P500 Diameter 250mm Cost of Pipe-Pl 000000 Annual Maintenance Cost-P60000 Operating cost/hour=P620 Total number of operating hours per year 500 Replacement is done every 10 years Money is worth 10% annually
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
The following data shows the different sizes of pipes which a company wishes to use as a replacement for the old pipe
system that they are using.
Diameter 100mm Cost of Pipe-P1800000 Annual Maintenance Cost-P88000 Operating cost/hour=P480
Diameter 150mm Cost of Pipe-Pl 120000 Annual Maintenance Cost-Pl 36000 Operating cost/hour=P500
Diameter 250mm Cost of Pipe-Pl 000000 Annual Maintenance Cost-P60000 Operating cost/hour=P620
Total number of operating hours per year 500
Replacement is done every 10 years
Money is worth 10% annually
Compute the equivalent annual cost of the 100mm pipe.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps with 2 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education