Engineering Economy (16th Edition) - Standalone book
16th Edition
ISBN: 9780133439274
Author: William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Question
Chapter 8, Problem 46P
To determine
Calculate the present worth.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Michael’s Lobster Food Truck has been operating for three years, but he’s yet to make a profit in the competitive food truck industry. Last year, he sold 2,500 items at an average price of $12. It costs him $9 to cover his ingredients for each item, and he also has fixed costs of $8,000 per year to cover for his truck, marketing, insurance, etc. What percentage increase in the number of units sold is required for Michael to break even?
Antoine rents rooms in his hotel for an average of $100 per night. The variable cost per rented room is $20, to cover maid service and utilities. His fixed costs are $100,000 and his profit last year was $20,000. For Antoine, the contribution per unit is
$100
$80
$1005
$800
Sally Statistics is implementing a system of statistical process control (SPC) charts in her factory in an effort to reduce the overall cost of scrapped product. The current cost of scrap is $X per month. If a 75% learning curve is expected in the use of the SPC charts to reduce the cost of scrap, what would the percentage reduction in monthly scrap cost be after the charts have been used for 6 months? (Hint: Model each month as a unit of production.)
Chapter 8 Solutions
Engineering Economy (16th Edition) - Standalone book
Ch. 8 - Prob. 1PCh. 8 - Prob. 2PCh. 8 - Prob. 3PCh. 8 - Prob. 4PCh. 8 - Prob. 5PCh. 8 - Prob. 6PCh. 8 - Prob. 7PCh. 8 - Prob. 8PCh. 8 - Prob. 9PCh. 8 - Prob. 10P
Ch. 8 - Prob. 11PCh. 8 - Prob. 12PCh. 8 - Prob. 13PCh. 8 - A commercial building design cost 89/square-foot...Ch. 8 - Prob. 15PCh. 8 - Prob. 16PCh. 8 - Prob. 17PCh. 8 - Prob. 18PCh. 8 - Prob. 19PCh. 8 - Prob. 20PCh. 8 - Prob. 21PCh. 8 - Prob. 22PCh. 8 - Prob. 23PCh. 8 - Prob. 24PCh. 8 - Prob. 25PCh. 8 - Prob. 26PCh. 8 - Prob. 27PCh. 8 - Prob. 28PCh. 8 - Prob. 29PCh. 8 - Prob. 30PCh. 8 - Prob. 31PCh. 8 - Prob. 32PCh. 8 - Prob. 33PCh. 8 - Prob. 34PCh. 8 - Prob. 35PCh. 8 - Prob. 36PCh. 8 - Prob. 37PCh. 8 - Prob. 38PCh. 8 - Prob. 39PCh. 8 - Prob. 40PCh. 8 - Prob. 41PCh. 8 - Prob. 42PCh. 8 - Prob. 43PCh. 8 - Prob. 44PCh. 8 - Prob. 45PCh. 8 - Prob. 46PCh. 8 - Prob. 47PCh. 8 - Prob. 48PCh. 8 - Prob. 49SECh. 8 - Prob. 50SECh. 8 - Prob. 51SECh. 8 - Prob. 52CSCh. 8 - Suppose the cost of electricity is expected to...Ch. 8 - Prob. 54CSCh. 8 - Prob. 55FECh. 8 - Prob. 56FECh. 8 - Prob. 57FECh. 8 - Prob. 58FECh. 8 - Prob. 59FECh. 8 - Prob. 60FECh. 8 - Prob. 61FE
Knowledge Booster
Similar questions
- A recent engineering was given the job of determining the best production rate for a new type of casting in a foundry. After experimenting with many combinations of hourly production rates and total production cost per hour, he summarized his findings in table below (column 2). The engineering then talked to the firm’s marketing specialist, who provided estimates of selling price per casting as a function of production output (see table 1 column 3). There are 8,760 hours in a year. What production rate would you recommend to maximize total profits per year? a) 100 ; b) 200 ; c) 300 ; d) 400 ; e) 500 show the computation how to solve it.arrow_forwardA recent engineering was given the job of determining the best production rate for a new type of casting in a foundry. After experimenting with many combinations of hourly production rates and total production cost per hour, he summarized his findings in table below (column 2). The engineering then talked to the firm’s marketing specialist, who provided estimates of selling price per casting as a function of production output (see table 1 column 3). There are 8,760 hours in a year. What production rate would you recommend to maximize total profits per year? a) 100 ; b) 200 ; c) 300 ; d) 400 ; e) 500 Show handwritten solutions.arrow_forwardCotton Corporation currently makes 13,400 subcomponents a year in one of its factories. The unit costs to produce the subcomponent are: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total unit cost Cost per Unit $ 32 33 20 12 $ 97 An outside supplier has offered to provide Cotton with the 13,400 subcomponents at an $97.00 per-unit price. No portion of fixed overhead is avoidable. If Cotton accepts the outside offer, what will be the effect on short-term profits? Multiple Choice О $160,800 increase $112 000 incroscoarrow_forward
- A manufacturing company produces solar panels. The variable costs are $20 per unit and fixed costs are $10,875. The price demand relationship for this product is P=-0.25Q+ 250, where P is the unit sales price of the product and Q is the demand of solar panels. Given the following: • Total cost = Fixed cost + Variable cost • Revenue = Demand x Price • Profit = Revenue - Total cost 26. The equation that represent the total cost is: a. ($10,875+$20) Q b. $10,875-$20 Q c. $10,875 × $20 Q d. $10,875+$20 Q 27. The equation that represent the total revenue is: a. $0.25Q²+$250Q b. - $0.25Q²+$250Q c. - $0.25Q²-$250Q d. $0.25Q²-$250Qarrow_forwardIn 2019, X Company sold 5,250 units of its only product. Total revenue was $1,345,575, total variable costs were $542,325, and total fixed costs were $735,000. In 2020, there are only two expected changes: variable costs will decrease by $4.70 per unit, and fixed costs will decrease by $24,900. How many units must X Company sell in 2020 in order to earn $33,000?arrow_forwardIn the fall, Jay Thompson decided to live in a university dormitory. He signed a dorm contract under which he was obligated to pay the room rent for the full college year. One clause stated that if he moved out during the year, he could sell his dorm contract to another student who would move into the dormitory as his replacement. The dorm cost was $6300 for the two semesters, which Jay had already paid. A month after he moved into the dorm, he decided he would prefer to live in an apartment. That week, after some searching for a replacement to fulfill his dorm contract, Jay had two offers. One student offered to move in immediately and to pay Jay $500 per month for the seven remaining months of the school year. A second student offered to move in the second semester and pay $2800 to Jay. Jay estimates his food cost per month is $350 if he lives in the dorm and $300 if he lives in an apartment with three other students. His share of the apartment rent and utilities will be $450 per…arrow_forward
- Lamburgs Incorporated is attempting to predict the impact of a forthcoming environmental regulation on the variable costs associated with one of their merchandise. The legislature is still debating the regulation. There is a 50% chance that the rules will not be ready in time to impact variable costs next year. Lamburgs management anticipates that when the regulation is completed, it will increase variable costs by either 5% or 10%. At the moment, the variable cost of the product is $200 per unit. What is the expected variable cost for Lamburgs' key product next year based on these assumptions?arrow_forwardJohnston, "Chapter 4," in Statistical Cost Analysis) AVC 1.24 0.0033Q + 0.0000029Q² 0.000046 QZ 0.026Z + 0.00018Z² where AVC = average variable cost (i.e., working costs of generation), measured in pence per kilowatt-hour (kWh). (A pence was a British monetary unit equal, at that time, to 2 cents U.S.) Q = output; measured in millions of kWh per year Z = plant size; measured in thousands of kilowatts What is the long-run total variable cost function for electricity generation? 0.0033 +20.0000029Q -0.000046Z ○ 1.24Q+0.0033Q² +0.000002903 -0.000046Q2Z-0.026ZQ+0.00018Z²Q ○ 0.0033Q+20.0000029Q² -0.000046 QZ 1.24+0.0033+0.0000029Q-0.000046 Z-0.02 + Q 0.00018Z Q What is the long-run marginal cost function for electricity generation? 1.24+0.0066Q+0.0000087Q² -0.000092QZ-0.026Z +0.00018 Z² ○ 0.0033Q+20.0000029Q² + 0.000046 QZ 1.24+0.0033+0.0000029+0.000046Z+ 0.025% 0.00018Z Q Q ○ 1.24Q+0.0033Q² +0.000002903+0.000046Q2Z +0.026ZQ+0.00018Z²Q Holding plant size constant at 150,000 kilowatts, what…arrow_forwardA recent engineering was given the job of determining the best production rate for a new type of casting in a foundry. After experimenting with many combinations of hourly production rates and total production cost per hour, he summarized his findings in (table 1). The engineering then talked to the firm's marketing specialist, who provided estimates of selling price per casting as a function of production output (see table 2). There are 8,760 hours in a year. What production rate would you recommend to maximize total profits per year? Table 1 Total cost per hr Casting production per hr $1,000 100 $2,600 200 $3,200 300 $3,900 400 $4,700 500 Table 2 Selling price / casting Casting production per hr $20.00 100 $17.00 200 $16.00 300 $15.00 400 $14.50 500 The answer is Blank 1 per hourarrow_forward
- A recent engineering was given the job of determining the best production rate for a new type of casting in a foundry. After experimenting with many combinations of hourly production rates and total production cost per hour, he summarized his findings in (table 1). The engineering then talked to the firm’s marketing specialist, who provided estimates of selling price per casting as a function of production output (see table 2). There are 8,760 hours in a year. What production rate would you recommend to maximize total profits per year? Table 1 Total cost per hr Casting production per hr $1,000 100 $2,600 200 $3,200 300 $3,900 400 $4,700 500 Table 2 Selling price / casting Casting production per hr $20.00 100 $17.00 200 $16.00…arrow_forwardA large company in the communication and publishing industry has quantified the relationship between the price of one of its products and the demand for this product as Price=160−0.02×Demand for an annual printing of this particular product. The fixed costs per year (i.e., per printing)=$47,000 and the variable cost per unit=$40. What is the maximum profit that can be achieved? What is the unit price at this point of optimal demand? Demand is not expected to be more than 4,000 units per year. The maximum profit that can be achieved is $? (Round to the nearest dollar.) The unit price at the point of optimal demand is $? per unit. arrow_forwardAt the beginning of the year, managers at King Industries estimated $420000 in manufacturing overhead, 20000 direct labor hours and 50000 machine hours. Actual manufacturing costs at the end of the year were $425000 in manufacturing overhead. During the year, 22000 direct labor hours and 47000 machine hours were incurred. If overhead is applied based on direct labor hours, what is the predetermined overhead rate for the coming year? $21.00 per direct labor hour $8.40 per direct labor hour $19.09 per direct labor hour $9.04 per direct labor hourarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Managerial Economics: Applications, Strategies an...EconomicsISBN:9781305506381Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. HarrisPublisher:Cengage Learning
Managerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage Learning
Managerial Economics: Applications, Strategies an...
Economics
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
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