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How is the AOC calculated and what are the solutions with steps? An engineer must decide between two ways to pump concrete to the top
How is the AOC calculated and what are the solutions with steps?
An engineer must decide between two ways to pump concrete to the top of a seven-story building. Plan 1 requires the leasing of equipment for $60,000 initially and will cost between $0.40 and $0.95 per metric ton to operate, with a most likely cost of $0.50 per metric ton. The pumper can pump 100 metric tons per 8hour day. If leased, the asset will have a contract period of 5 years. Plan 2 is a rental option that will cost $11000 per year. In addition, an extra $18.5 per hour labor cost will be incurred for operating the rented equipment per 8-hour day. Which plan should the engineer recommend ifthe equipment will be needed for 65 days per year? The MARR is 10% per year. "he annual worth of plan 1 lease optimistic is $ 47828 O . "he annual worth of plan 1 most likely is $ 48328 0. "he annual worth of plan 1 pessimistic is $ "he annual worth of plan 2 rental is $ |:| . Plan 1 lease optimistic is better 0 than rental of plan 2. Planl most likely is Othan rental of plan 2 Plan 1 lease pessimistic is 0 than rental of plan 2Step by Step Solution
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