Illinois Department of Transportation plans to resurface the US 51 Business Route from Osage Street to...

  

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Illinois Department of Transportation plans to resurface the US 51 Business Route from Osage Street to Raab Street in Summer 2021. Republic Service, Ltd., has been hired to provide the pavement material of 60,000 yd³. It is estimated that the job will take 5 weeks and the contractor has identified two locations for pavement preparation. The cost detail of these two sites are the following: Average hauling distance to the job site Weekly rental of the prep site Flag person ($160/person-week) Cost to set up and remove equipment Hauling expense Cost Factor Site A 5 miles $700 1 person $15,000 $2.5 yd³-mile Site B 4 miles $1,200 2 people $25,000 $2.5 yd³-mile (a) Please compare these two sites in terms of fixed cost, variable cost, and total cost (15 points). (b) Please suggest the site that the contractor should choose, and calculate the unit cost of the selected site (e.g., per cubic yard) (10 points). (c) Based on the result of (b), the contractor will be paid $12 per cubic yard of pavement material delivered to the job site. How many cubic yards of pavement material will the contractor have to deliver before starting to make a profit? (10 points) Note. Please show how you get each answer in order to get partial credit. A correct answer without showing the calculation process NOT receive any credits. Illinois Department of Transportation plans to resurface the US 51 Business Route from Osage Street to Raab Street in Summer 2021. Republic Service, Ltd., has been hired to provide the pavement material of 60,000 yd³. It is estimated that the job will take 5 weeks and the contractor has identified two locations for pavement preparation. The cost detail of these two sites are the following: Average hauling distance to the job site Weekly rental of the prep site Flag person ($160/person-week) Cost to set up and remove equipment Hauling expense Cost Factor Site A 5 miles $700 1 person $15,000 $2.5 yd³-mile Site B 4 miles $1,200 2 people $25,000 $2.5 yd³-mile (a) Please compare these two sites in terms of fixed cost, variable cost, and total cost (15 points). (b) Please suggest the site that the contractor should choose, and calculate the unit cost of the selected site (e.g., per cubic yard) (10 points). (c) Based on the result of (b), the contractor will be paid $12 per cubic yard of pavement material delivered to the job site. How many cubic yards of pavement material will the contractor have to deliver before starting to make a profit? (10 points) Note. Please show how you get each answer in order to get partial credit. A correct answer without showing the calculation process NOT receive any credits.

Answer rating: 100% (QA)

a Comparing the two sites in terms of fixed cost variable cost and total cost Site A Average hauling ... View the full answer