1. A new CAT 657G scraper costing $1,250,000 delivered to the contractor is to be used for 8 hours each working day (Monday through Friday) for an estimated 40 working weeks per year for 6 years. At the end of the sixth year, its salvage value is estimated at $500,000. It is rated at 600- hp, and has a diesel engine with an operating factor of 0.75. Tires for the scraper cost $24,500 each, and last for 4,800 hours. The crankcase capacity is 15 gallons and the lube oil must be changed every 500 hours. Assume the cost for lube oil is $12.00/gal, and the cost of diesel fuel is $3.25/gal. Interest, taxes, and storage total to 20% of the average annual investment. Insurance for the machine is 3% of the average annual investment. Machine repairs will be 80% of the depreciation of the machine, and tire repair will be 10% of the depreciation of the tires. a.) Find the Hourly owning and operating costs of the machine. b.) Suppose another dealer offers the same scraper for $1,500,000, but with a Maintenance and Tire Package which covers all machine repairs and includes tire replacement and tire repair for the duration of the machine use. Otherwise, everything else is the same. The owner of the machine is responsible for buying and changing the lube oil and for fuel. Which machine would be more cost effective per hour? 1. A new CAT 657G scraper costing $1,250,000 delivered to the contractor is to be used for 8 hours each working day (Monday through Friday) for an estimated 40 working weeks per year for 6 years. At the end of the sixth year, its salvage value is estimated at $500,000. It is rated at 600- hp, and has a diesel engine with an operating factor of 0.75. Tires for the scraper cost $24,500 each, and last for 4,800 hours. The crankcase capacity is 15 gallons and the lube oil must be changed every 500 hours. Assume the cost for lube oil is $12.00/gal, and the cost of diesel fuel is $3.25/gal. Interest, taxes, and storage total to 20% of the average annual investment. Insurance for the machine is 3% of the average annual investment. Machine repairs will be 80% of the depreciation of the machine, and tire repair will be 10% of the depreciation of the tires. a.) Find the Hourly owning and operating costs of the machine. b.) Suppose another dealer offers the same scraper for $1,500,000, but with a Maintenance and Tire Package which covers all machine repairs and includes tire replacement and tire repair for the duration of the machine use. Otherwise, everything else is the same. The owner of the machine is responsible for buying and changing the lube oil and for fuel. Which machine would be more cost effective per hour