Contemporary Engineering Economics (6th Edition)
6th Edition
ISBN: 9780134105598
Author: Chan S. Park
Publisher: PEARSON
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Chapter 6, Problem 27P
To determine
Calculate the cost per mile.
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Jennifer Ozman is a sales engineer at Montana Chemical Engineering Company. Jennifer owns two vehicles, and one of them is entirely dedicated to business use. Her business car is a small, used pickup truck, which she purchased with $11,000 of
personal savings. On the basis of her own records and with data compiled by the U.S. Department of Transportation, Jennifer has estimated the costs of owning and operating her business vehicle for the first three years as given in the table below. If
her interest rate is 7%, what should be Jennifer's reimbursement rate per mile so that she can break even?
Click the icon to view the costs of owning and operating the business vehicle.
Click the icon to view the interest factors for discrete compounding when i=7% per year.
The reimbursement rate should be $ per mile. (Round to the nearest cent.)
- X
More Info
More Info
Single Payment
Compound
Amount
Factor
(F/A, i, N)
Third Year
First Year
$2,879
Second Year
$1,776
153
N
$1,545
220
100
1.0000
635
835…
Jessica has been working for a law firm and earning an annual salary of $90,000. She decides to open her own practice. Her annual expenses were $15,000 for office rent, $1,700 for supplies, $800 for utilities, and a $30,000 salary for a secretary/bookkeeper. Jessica covered her start-up expenses by cashing in a $20,000 certificate of deposit on which she was earning annual interest of $500. (The $20,000 was spent on furniture and at the end of the year the furniture is still in the office, assuming there is no depreciation, so the $20,000 from the certificate of deposit is not a cost).
Her practice generated $150,000 revenue in the first year.
Please show calculations thank you!
Calculate Jessica's Implicit & explicit costs.
Calculate Jessica's Economic costs and economics profit.
Calculate Jessica's Accounting profits.
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
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
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