A Loader cost Ph 2,115,000 to purchase. Fuel, oil grease, and minor maintenance are estimated to cost Ph580 per operating hour.

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
icon
Related questions
Question
A Loader cost Ph 2,115,000 to purchase. Fuel, oil grease, and minor maintenance are estimated to cost Ph580 per operating hour. A set of tires cost Ph150,000 to replace, and their estimated life is 2,800 use hours. A Ph282,000 major repair will probably be required after 4,200hr of use. The equipment is expected to last for 8,400 hr, after which it will be sold at a price equal to 15% of the original purchase price. A final set of new tires will not be purchased before the sale. How much should the owner of the Dozer charge per hour of use, if it is expected that the machine will operate 1,400 hr per year? The company’s capital rate is 8%.
Expert Solution
steps

Step by step

Solved in 4 steps with 1 images

Blurred answer
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
Economics
ISBN:
9780190931919
Author:
NEWNAN
Publisher:
Oxford University Press
Principles of Economics (12th Edition)
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
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)
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Managerial Economics: A Problem Solving Approach
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-…
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education