EBK ENGINEERING ECONOMY
16th Edition
ISBN: 9780133819014
Author: Koelling
Publisher: YUZU
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Question
Chapter 1, Problem 14P
a.
To determine
The problem in the given situation.
b.
To determine
To apply the principlies of engerring exonomics to problems defined.
c.
To determine
The better value for getting pizza on the crietria of minimizing cost per unit of volume.
d.
To determine
The other crietria that is used to select pizza.
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While studying for the engineering economy final exam, you and two friends find yourselves craving a fresh pizza. You can’t spare the time to pick up the pizza and must have it delivered. “Pizza Hut” offers a 1-1/4-inch-thick (including toppings), 20-inch square pizza with your choice of two toppings for $15 plus 5% sales tax and a $1.50 delivery charge (no sales tax on delivery charge). “Dominos” offers the round, deep-dish Sasquatch, which is 20 inches in diameter. It is 1-3/4 inches thick, includestwo toppings, and costs $17.25 plus 5% sales tax and free delivery.
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A local restaurateur who had been running a profitable business for many years, recently purchased a three-way liquor license. This on-premise license gives the owner the legal right to sell beer, wine, and spirits in her restaurant. The cost of obtaining the three-way license was about $90,000, since only 300 such licenses are issued by the state. While the license is transferable, only $75,000 is refundable if the owner chooses not to use the license. After selling alcoholic beverages for about one year, the restaurateur came to the realization that she was losing dining customers and that her profitable restaurant was turning into a noisy, unprofitable bar. Subsequently, she spent about $8,000 placing advertisements in various newspapers and restaurant magazines across the state offering to sell the license for $80,000. After a long wait, she finally received one offer to purchase her license for $77,000.
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EBK ENGINEERING ECONOMY
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