A concrete manufacturing process can be designed for varying degrees of automation. The minimum required rate...
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A concrete manufacturing process can be designed for varying degrees of automation. The minimum required rate of return is 10% and economic life is 5 years. Salvage at that date is estimated to be zero. Which of the levels should be selected? Use the incremental rate of return method. Level First Cost 1 2 3 4 $100,000 $175,000 $300,000 $500,000 Annual Cost of Annual Cost of Labor Power $70,000 $4,000 $55,000 $5,000 $35,000 $6,500 $20,000 $8,000 Annual Cost of Maintenance $1,000 $1,500 $2,200 $3,000 A concrete manufacturing process can be designed for varying degrees of automation. The minimum required rate of return is 10% and economic life is 5 years. Salvage at that date is estimated to be zero. Which of the levels should be selected? Use the incremental rate of return method. Level First Cost 1 2 3 4 $100,000 $175,000 $300,000 $500,000 Annual Cost of Annual Cost of Labor Power $70,000 $4,000 $55,000 $5,000 $35,000 $6,500 $20,000 $8,000 Annual Cost of Maintenance $1,000 $1,500 $2,200 $3,000
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Level 1 Annual Cost 70000 4000 1000 75000 Rate of Return 75000 100000 100 75 Level 2 ... View the full answer
Related Book For
Engineering Economy
ISBN: 978-0132554909
15th edition
Authors: William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Posted Date:
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