An airline company has been contracting a maintenance company to do overhauls for its planes at a cost of $51275 per plane per quarter. The airline company estimates that by building a $1461838 maintenance facility with a life of 5 years and a residual market value of $770217 at the end of its life, they could handle their own overhaul at a cost of only $42020 per plane per quarter, What is the minimum number of planes they must operate to mako it just profitable to build this facility? (-2% per quarter).

An airline company has been contracting a maintenance company to do overhauls for its planes at a cost of $51275 per plane per quarter. The airline company estimates that by building a $1461838 maintenance facility with a life of 5 years and a residual market value of $770217 at the end of its life, they could handle their own overhaul at a cost of only $42020 per plane per quarter, What is the minimum number of planes they must operate to mako it just profitable to build this facility? (-2% per quarter).

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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