Engineering Economy Plus Mylab Engineering With Pe Format: Cloth Bound With Access Card
17th Edition
ISBN: 9780134873206
Author: Sullivan, William G.^wicks, Elin M.^koelling, C. P
Publisher: Prentice Hall
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Chapter 13, Problem 12P
To determine
Formulation of capital allocation problem as a linear integer programming model.
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LEARNING EXERCISE 2
1. Two alternative designs are under consideration for a tapered fastening pin. The fastening pins are
sold for $0.70 each. Either design will serve equally well and will involve the same material and
manufacturing cost except for the lathe and drill operations. Design A will require 12 hours of lathe time
and 5 hours of drill time per 1,000 units. Design B will require 7 hours of lathe time and 8 hours of drill
time per 1,000 units. The variable operating cost of the lathe, including labor, is $18.60 per hour. The
variable operating cost of the drill, including labor, is $16.90 per hour. Finally, there is a sunk cost of
$5,000 for Design A and $9,000 for Design B due to obsolete tooling.
a. Which design should be adopted if 125,000 units are sold each year?2w gawen ni yilaunsm
b. What is the annual saving over the other design? dipet jeen
e1s enoiluloe uoy eue elsM
evip elshetem pnimsel ertt of 1ele vem uoY ugjuo ioubivibni ns al airlT
Describe in detail why a project with a Present Worth (PW) equal to or greater than zero is
economically justifiable
Chapter 13 Solutions
Engineering Economy Plus Mylab Engineering With Pe Format: Cloth Bound With Access Card
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