Engineering Economy (17th Edition)
17th Edition
ISBN: 9780134870069
Author: William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Question
Chapter 14, Problem 3P
To determine
Ranking the alternatives.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
After graduation, you face a choice. You can work for a multinational consulting firm and earn a starting salary (including benefits) of
$45,000, or you can start your own consulting firm using $6,000 of your own savings. If you keep your money in a savings account,
you can earn an interest rate of 5 percent. You choose to start your own consulting firm. At the end of the first year, you add up all of
your expenses and revenues. Your expenses include $14,000 for rent, $1,600 for office supplies, $22,000 for labor, and $4,900 for
telephone expenses. After operating your consulting firm for a year, your total revenues are $102,000.
Instructions: Enter your answers as a whole number.
a. What is your accounting profit?
$ 44,500 8
b. What is your economic profit?
$ 4,150
Your monthly budget is $2500.00. You have been asked to save 25% of your monthly budget.
Please show the formula that you would use in excel.
Often it makes a lot of sense to spend some money now so you can save more money in the future. Consider filtered water. A high-tech water filter costs about $60 and can filter 7,200 ounces of water. This will save you purchasing two 20-ounce bottles of filtered water every day, each costing $1.15. The filter will need replacing every 6 months. How much will this filter save you in a year’s time?
Chapter 14 Solutions
Engineering Economy (17th Edition)
Knowledge Booster
Similar questions
- The option or alternatives from which decision are madearrow_forwardBuying and selling textbooks are two separate decisions made at the margin. Textbooks create value both when they are bought and when they are sold. Think about your decision to buy the textbook for this course. You paid $225 for the book, but you would have been willing to pay $400 to use the book for the semester. Suppose that at the end of the semester you could keep your textbook or sell it back to the bookstore. Once you have completed the course, the book is worth only $90 to you. The bookstore will pay you 50% of the original $225. How much total value have you gained? $arrow_forwardJohn was a troubled teen and got arrested several times and even spent some time in a juvenile detention center. John is now 22 years old and briefly attended Highline College but dropped out and has no job. John’s grandmother is very concerned, so she promised John that if he got a steady job, did not break the law again, and if he went back to Highline College if he could be re-admitted, she would pay John $50,000. John loved his grandmother and he promised to do all of that for her. Discuss whether these various promises on John’s part would constitute valid consideration for the payment of the $50,000. Please fully explain your answer for all the points.arrow_forward
- You start an insurance company as your first entrepreneurial venture after graduation. Your main product line is malpractice insurance for dentists. After exhaustive research, you learn that settling malpractice claims against careful dentists costs $2,000 and settling malpractice claims against reckless dentists costs $7,500. Individual dentists know whether they are reckless or careful, and your research shows that approximately 20% of dentists are reckless. How much do should you charge for malpractice insurance to break even?arrow_forwardYour company has invested $5 million in developing a new product, but the development process isn’t quite complete. You have just learned from your marketing team that other companies have introduced similar products. As a result of this competition, the expected sales of your new product once you have completed development and actually begun production is now just $3 million. Your production team tells you that it will cost another $1 million to finish development and make your product. The decision is now yours: should you give the go-ahead to complete development of the product? Why or why not? In the event that your production team’s cost estimate is inaccurate, what is the most that your company should pay to complete development? Why? Be sure to incorporate (and define) the relevant concept into your answer.arrow_forwardAbigail, an analyst with a venture capital firm, is approached by Tomas about financing his new business venture, a company that will produce solar-powered hydroponic growing equipment for light industrial use. What information should Abigail have before making a decision about financing Tomas’s new company?arrow_forward
- You are looking for a car to lease. Your income is $3,000 per month, and you know that you should not spend more than 20 percent of your income on a car payment. You have found four deals in the table below. options Location Monthly Rent Toyota Camry $400 Lincoln MKZ $660 Ford Fusion $380 BMW 740 $720 Instructions: In order to receive full credit, you must make a selection for each option. For the correct answer(s), click the box once to place a checkmark. For the incorrect answer(s), click the option twice to empty the box. Suppose you adhere to the 20 percent guideline but also receive a $100 monthly allowance from your parents towards your car payment, which option(s) fall within your budget? Group of answer choices Toyota Camry Lincoln MKZ Ford Fusion BMW 740arrow_forwardYou see an advertisement for a used car. The owner has not set a price but asks for people to make him an offer. You inspect the car and believe that the true value is equally likely to be anywhere in the range of $1,000 to $9,000 (so your calculation of the average of this value is $5,000). The current owner knows the exact true value, and he will for sure accept your offer if it is higher than the true value (but not if it is lower than that value). If your offer is accepted and you get the car, then you will find out the true value. But you know in advance that your amazing car repair skills can increase the value of the car by 25% of whatever its true value is. What is your expected profit if you offer $5,000? Round your answer to the nearest dollar (e.g. 500). If you expect to make a loss, add a minus sign (e.g. -500, please do not include space between minus sign and the number if the answer is negative). Note:- Do not provide handwritten solution. Maintain accuracy and quality…arrow_forwardYou just spent $40 on a new movie for your collection. You would have preferred the director's cut but discovered when you got home that you bought the theatrical version. The store you bought the movie from has an “all sales final" policy, but you could resell the movie online for $25. The director's cut sells for $50. Instructions: Round your answer to the nearest whole number. By how much would you need to value the director's cut over the theatrical version for it to make sense for you to sell the version you bought and buy the director's cut? $ 30 Xarrow_forward
- You were able to purchase two tickets to an upcoming concert for $100 apiece when the concert was first announced three months ago. Recently, you saw that StubHub was listing similar seats for $225 apiece. What does it cost you to attend the concert?arrow_forwardYour classmates from the University of Chicago are planning to go to Miami for spring break, and you are undecided about whether you should go with them. The round-trip airfare is $600, but you have a frequent-flyer coupon worth $500 that you could use to pay part of the airfare. All other costs for the vacation are exactly $900. The most you would be willing to pay for the trip is $1,400. Your only alternative use for your frequent-flyer coupon is for your trip to Atlanta two weeks after the break to attend your sister's graduation, which your parents are forcing you to attend. The Chicago-Atlanta round-trip airfare is $450. If you do not use the frequent-flyer coupon to fly to Miami, should you go to Miami? Multiple Choice Yes, your benefit is more than your cost. No, your benefit is less than your cost. Yes, your benefit is equal to your cost. No, because there are no benefits in the trip.arrow_forwardLuis and his best friend Faith want to spend as much time as possible at the local amusement park this summer, so they’re going to buy season passes. The passes are normally $120 each, but for three days only, they’re on sale: Buy one, get one half off. Luis agrees to wait in line to buy them the season passes, and they’ll split the cost evenly. How much will Faith owe Luis?arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Microeconomics: Principles & PolicyEconomicsISBN:9781337794992Author:William J. Baumol, Alan S. Blinder, John L. SolowPublisher:Cengage Learning
Microeconomics: Principles & Policy
Economics
ISBN:9781337794992
Author:William J. Baumol, Alan S. Blinder, John L. Solow
Publisher:Cengage Learning