An assembly line robot arm with a first cost of $75,000 in 2001 had a cost of $89,750 in 2017. If the equipment cost index for robots was 307 in 1995 and the robot cost increased exactly in proportion to the index, the value of the index in 2017 was closest to: (a) 367 (b) 395 (c) 437 (d) 4

An assembly line robot arm with a first cost of $75,000 in 2001 had a cost of $89,750 in 2017. If the equipment cost index for robots was 307 in 1995 and the robot cost increased exactly in proportion to the index, the value of the index in 2017 was closest to: (a) 367 (b) 395 (c) 437 (d) 4

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter3: Benefits, Costs, And Decisions

Section: Chapter Questions

Problem 8MC

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Question

An assembly line robot arm with a first cost of
$75,000 in 2001 had a cost of $89,750 in 2017. If the
equipment cost index for robots was 307 in 1995 and
the robot cost increased exactly in proportion to the
index, the value of the index in 2017 was closest to:
(a) 367 (b) 395 (c) 437 (d) 4

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