Question: Two pumps can be used for pumping a corrosive liquid. A pump with a brass impeller costs ` 40,000 and is expected to last for

Two pumps can be used for pumping a corrosive liquid. A pump with a brass impeller costs

` 40,000 and is expected to last for three years. A pump with a stainless steel impeller will cost

` 95,000 and lasts for five years. An overhaul costing ` 15,000 will be required after 2,000 operating hours of the brass option, while an overhaul of ` 35,000 is estimated for the stainless steel option after 9,000 hours. If the operating cost of each pump is ` 25/hour, how many hours/year must the pump be required to justify the purchase of an expensive pump? (Use interest rate of 10 per cent/year.)

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Project Management Questions!

Jim Anderson is a training specialist in the human resource department of a large pharmaceutical company. In response to a recent company wide survey, Jim specifically designed a 6-week training...

For the scenario described below, determine the minimum number of hours per year that the more expensive pump must be used to justify its purchase. Clearly show the method you have used. State and...

uestion: 1. IN A STOCK ACQUISITION ACCOUNTED FOR BY THE EQUITY METHOD, A PORTION OF THE PURCHASE PRICE OFTEN IS ATTRIBUTABLE TO GOODWILL OR TO SPECIFIC ASSETS OR LIABILITIES. HOW OR UNDER WHAT BASIS...

Medical grade oxygen has become a product of national priority now. Oxygen concentration based on pressure swing adsorption is quickly becoming an obsolete technology. You are asked to dissect a...

4. 8.14 Two small chemical feed pumps are under consideration for pumping a corrosive liquid from a catalytic reforming process in a refinery. A pump with a brass impeller costs $800 and is expected...

Two small chemical feed pumps are under consid- eration for pumping a corrosive liquid from a 8.15 8.16 8.17 catalytic reforming process in a refinery. A pump with a brass impeller costs $800 and is...

Beaufort Sea Production Company (BSPC) operates a medium-sized oil field on Alaskas north coast. The field is still producing at its maximum rate, 325,000 barrels of oil per day (BOPD). However, to...

Read: Strategic Management Cases Case Study #12 Pixar Case Study #20 Nintendo: Could the Switch Turn on Gamers? Prepare a written SWOT analysis for each company using the information provided in the...

Please read the PIXAR CASE - AND ANSWER THE FILL IN CHARTS AT THE BOTTOM OF THE PAGE! CASES CASE 12 PIXAR* In spite of its domination of Academy Awards for Best Ani- broke all records for opening...

URGENT HELP!!!!! Please answer within 2 hours. Q: Read the case and imagine yourself as a management consultant of Pixar, give at least 700 words recommendation written report for this company(may...

CASE DETAILS Jennifer Price, the Production Manager and Paul Low the Marketing Manager both at P&B Natural Co were sitting in at an inhouse presentation on operations and strategy by Jo Hallow,...

"Combined cash? budget" is best defined by which ofthe? following? A. A? company's plan to purchase of? property, plantand? equipment, and other? long-term assets B. A budget that projects? assets,...

Answer the following questions taken from the topic Arrival of Occlusion Stage. 1: What marks the arrival of the occlusion stage during the development of a mid-latitude cyclone, in your area? 2:...

Describe the formal procedure Best Buy has established for billing and collecting from credit customers. How do they leverage the five C ' s of credit to determine a customer's ability to pay?...