Lecture name: Engineering Economics

$40$ employees are divided into two equal groups: less productive half and more productive

half. The average output of the less productive half is $40\mathrm{.}2$ satisfactory units per employee

per hour and $14$ unsatisfactory units per hour. The average output of the more productive

group is $52\mathrm{.}6$ satisfactory units per employee per hour and $0\mathrm{.}8$ unsatisfactory units per

employee per hour. The employees receive $$3\mathrm{.}30$ per hundred satisfactory units. The firm

sustains a loss of $$0\mathrm{.}07$ for each unsatisfactory unit. One machine required for each

employee. Each machine has an annual fixed cost of $$320$ per year and a variable cost of

$50\mathrm{.}18$ per hour. Supervision and other overhead costs are estimated at $$720$ per employee

per year. The average employee works $1900$ hours per year. The price per satisfactory unit

is given as $7$ cent. The company is planning to increase the productivity of the less

productive half to the productivity level of the more productive half. The planned program

is required to pay is annual expenses with the annual benefits carmed by the company.

The amount of money at maximum can be paid for the program annually is equal to