- Think back to your first hour after awakening this morning. List 15 decision-making opportunities that existed during that hour. After you have done
- Some of the following problems would be suitable for solution by engineering economic analysis. Which ones are they?(a) Would it be better to buy an
- Which one of the following problems is most suitable for analysis by engineering economic analysis?(a) Some 45jt candy bars are on sale for 12 bars
- If you have $300 and could make the right decisions, how long would it take you to become a millionaire? Explain briefly what you would do.
- The owner of a small machine shop has just lost one of his larger customers. The solution to his problem, he says, is to fire three machinists to
- Every college student had the problem of selecting the college or university to attend. Was this a simple, intermediate, or complex problem for you?
- The college bookstore has put pads of engineering computation paper on sale at half price. What is the minimum and maximum number of pads you might
- Consider the seven situations described. Which one situation seems most suitable for solution by engineering economic analysis?(a) Jane has met two
- An automobile manufacturer is considering locating an automobile assembly plant in your region. List two simple, two intermediate, and two complex
- Consider the following situations. Which ones appear to represent rational decision making? Explain.(a) Joe's best friend has decided to become a
- Identify possible objectives for NASA. For your favorite of these, how should alternative plans to achieve the objective is evaluated?
- Suppose you have just 2 hours to answer the question, How many people in your home town would be interested in buying a pair of left-handed scissors?
- A college student determines that he will have only $50 per month available for his housing for the coming year. He is determined to continue in the
- Describe a situation where a poor alternative was selected, because there was a poor search for better alternatives.
- Choose the better of the undesirable alternatives. The three economic criteria for choosing the best alternative are minimize input, maximize output,
- As in Problem 1-18, state the appropriate economic criterion for each of the following situations.(a) The engineering school held a raffle of an
- Seven criteria are given in the chapter for judging' which is the best alternative. After reviewing the list, devise three additional criteria that
- Suppose you are assigned the task of determining the route of a new highway through an older section of town. The highway will require that many
- Identify benefits and costs for Problem 1-21.
- In 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
- An electric motor on a conveyor burned out. The foreman told the plant manager that the motor had to be replaced. The foreman indicated that there
- Bill Jones's parents insisted that Bill buy himself a new sport shirt. Bill's father gave specific instructions, saying the shirt must be in "good
- A farmer must decide what combination of seed, water, fertilizer, and pest control will be most profitable for the coming year. The local
- Identify the alternatives, outcomes, criteria, and process for the selection of your college major? Did you make the best choice for you?
- Describe a major problem you must address in the next two years. Use the techniques of this chapter to structure the problem and recommend a decision.
- One strategy for solving a complex problem is to break the problem into a group of less complex problems and then find solutions to the smaller
- On her first engineering job, Joy Hayes was given the responsibility of determining the production rate for a new product. She has assembled data as
- Willie Lohmann travels from city to city in the conduct of his business. Every other year he buys a used . car for about $12,000. The auto dealer
- Maria, a college student, is getting ready for three final examinations at the end of the school year. Between now and the start of exams, she has 15
- A city is in need of increasing its rubbish disposal facilities. There is a choice of two rubbish disposal areas, as follows. Area A: A gravel pit
- An oil company is considering adding an additional grade of fuel at its service stations. To do this, an additional 3000-gallon tank must be buried
- The vegetable buyer for a group of grocery stores has decided to sell packages of sprouted grain in the vegetable section of the stores. The product
- Cathy Gwynn, a recently graduated engineer, decided to invest some of her money in a "Quick Shop" grocery store. The store emphasizes quick service,
- Jim Jones, a motel owner, noticed that just down the street the "Motel 36" advertises a $36-per-night room rental rate on its sign. As a result, this
- A firm is planning to manufacture a new product. The sales department estimates that the quantity that an be sold depends on the selling price. As
- A manufacturing firm has received a contract to assemble 1000units of test equipment in the next year. The firm must decide how to organize its
- A grower estimates that if he picks his apple crop now, he will obtain 1000 boxes of apples, which he can sell at $3 per box. However, he thinks his
- Bob Johnson decided to purchase a new home. After looking at tracts of new homes, he decided .that a custom-built home was preferable. He hired an
- Venus Computer can produce 23,000 personal computers a year on its daytime shift. The fixed manufacturing costs per year are $2 million and the total
- A small machine shop, with 30 hp of connected load, purchases electricity under the following monthly rates (assume any demand charge is included in
- Two automatic systems for dispensing maps are being compared by the state highway department. The accompanying breakeven chart of the comparison of
- Mr. Sam Spade, the president of Ajax, recently read in a report that a competitor named Bendix has the following relationship between cost and
- A privately owned summer camp for youngsters has the following data for a 12-week session:Charge per camper ................................$120 per
- Two new rides are being compared by a local amusement park in terms of their annual operating costs. The two rides are assumed to be able to generate
- Consider the accompanying breakeven graph for an investment, and answer the following questions as they pertain to the graph.(a) Give the equation to
- Quatro Hermanas, Inc. is investigating implementing some new production machinery as part of its operations. Three alternatives have been identified,
- Three alternative designs have been created by Snakisco engineers for a new machine that spreads cheese between the crackers in a Snakisco snack.
- A small company manufactures a certain product. Variable costs are $20 per unit and fixed costs are $10,875. The price-demand relationship for this
- A painting operation is performed by a production worker at a labor cost of $1.40 per unit. A robot spray painting machine, costing $15,000, would
- Company A has fixed expenses of $15,000 per year and each unit of product has a $0.002 variable cost. Company B has fixed expenses of $5000 per year
- A firm believes the sales volume (S) of its product depends on its unit selling price (P) and can be determined from the equation P = $100 - S. The
- Consider the situation of owning rental properties that local university students rent from you on an academic year basis. Develop a set of costs
- Define the difference between a "cash cost" and a "book cost." Is engineering economic analysis concerned with both types of cost? Give an example of
- In your own words, develop a statement of what the authors mean by "life-cycle costs." Is it important for a firm to be aware of life-cycle costs?
- In looking at Figures 2-4 and 2-5, restate in your own words what the authors are trying to get across with these figures. Do you agree that this is
- In the text the authors describe three effects that complicate the process of making estimates to be used in engineering economy analyses. List these
- Northern Tundra Telephone (NIT) has received a contract to install emergency phones along a new 100-mile section of the Snow-Moose Turnpike. Fifty
- You and your spouse are planning a second honeymoon to the Cayman Islands this summer and would like to have your house painted while you are away.
- You are interested in having a mountain cabin built for weekend trips, vacations, to host family, and perhaps eventually to retire in. After
- Sung Sam, Inc. is currently designing a new digital camcorder that is projected to have the following per unit costs to manufacture:Cost Categories
- Fifty years ago, Grandma Bell purchased a set of gold plated dinnerware for $55, and last year you inherited it. Unfortunately a house fire at your
- Your boss is the director of reporting for the Athens County Construction Agency (ACCA). It has been his job to track the cost of construction in
- An refinisher of antiques named Constance has been so successful with her small business that she is planning to expand her shop with all new
- Refer to Problem 2-26 and now assume the prices for the equipment that Constance wants to replace have not been constant. Use the cost index data for
- Five years ago, when the relevant cost index was 120, a nuclear centrifuge cost $40,000. The centrifuge had a capacity of separating 1500 gallons of
- Padre works for a trade magazine that publishes. lists of Power-Sizing Exponents (PSE) that reflect economies of scale for developing engineering
- Develop an estimate for each of the following situations.(a) The cost of a 500-mile automobile trip, if gasoline is $1 per gallon, vehicle wear and
- If 200 labor hours were required to produce the 15tunit in a production run and 60 labor hours were required to produce the 7th unit, what was the
- Rose is a project manager at the civil engineering consulting firm of Sands, Gravel, Concrete, and Waters, Inc. She has been collecting data on a
- Sally Statistics is implementing a system of statistical process control (SPC) charts in her factory in an effort to reduce the overall cost of
- Randy Duck out has been asked to develop an estimate of the per-unit selling price (the price that each unit will be sold for) of a new line of
- Develop a statement that expresses the extent to which cost estimating topics also apply to estimating benefits. Provide examples to illustrate.
- On December 1, AI Smith purchased a car for $18,500. He paid $5000 immediately and agreed to pay three additional payments of $6000 each (which
- Bonka Toys is considering a robot that will cost $20,000 to buy. After 7 years its salvage value will be $2000. An overhaul costing $5000 will be
- Pine Village needs some additional recreation fields. Construction will cost $225,000 and annual O&M expenses are $85,000. The city council
- Identify your major cash flows for the current school term as first costs, O&M expenses, salvage values, revenues, overhauls, and so on. Using a
- In your own words explain the time value of money. From your own life (either now or in a situation -that might occur in your future), provide an
- Magdalen, Miriam, and Mary June were asked to consider two different cash flows: $500 that they could receive today and $1000 that would be received
- Solve the diagram below for the unknown Q assuming a 10% interest rate.
- The following series of payments will repay a present sum of $5000 at an 8% interest rate. Using single payment factors, what present sum is
- A man went to his bank and borrowed $750. He agreed to repay the sum at the end of 3 years, together with the interest at 8% per year. How much will
- The local bank offers to pay 5% interest on savings deposits. In a nearby town, the bank pays 1.25% per 3 month period (quarterly). A man who has
- The Apex Company sold a water softener to Marty Smith. The price of the unit was $350. Marty asked for a deferred payment plan, and a contract was
- One thousand dollars is borrowed for one year at an interest rate of 1%per month. If the same sum of money could be borrowed for the same period at
- A sum of money Q will be received 6 years from now. At 5% annual interest the present worth now of Q is $60. At the same interest rate, what would be
- In 1995 an anonymous private collector purchased a painting by Picasso entitled Angel Fernandez De Soto for $29,152,000. The picture depicts
- (a) If $100 at Time "0" will be worth $110 a year hence and was $90 a year ago, compute the interest rate for the past year and the interest rate
- How much must you invest now at 7.9% interest to accumulate $175,000 in 63 years?
- We know that a certain piece of equipment will cost $150,000 in 5 years. How much will it cost today using 10% interest?
- The local garbage company charges $6 a month for garbage collection. It had been their practice to send out bills to their 100,000 customers at the
- Sally Stanford is buying an automobile that costs $12,000. She will pay $2000 immediately and the remaining $10,000 in four annual end-of-year
- For the following diagram, compute the IRR to within 112%.
- For the following diagram, compute the interest rate at which the costs are equivalent to the benefits.
- For the following diagram, compute the rate of return.
- For the following diagram, compute the rate of return on the $3810 investment.
- For the following diagram, compute the rate of return.
- Consider the following cash flow:Year Cash
- What sum of money now is equivalent to $8250 two years hence, if interest is 4% per 6-month period?
- A sum of money invested at 2% per 6-month period (semiannually), will double in amount in approximately how many years?
- The United States recently purchased $1 billion of 30-year zero-coupon bonds from a struggling foreign nation. The bonds yield 41/z% per year