Question
Problem 2 An oil production analyst is interested in estimating the annual labor and material costs at present for a new production facility. She was
Problem 2 An oil production analyst is interested in estimating the annual labor and material costs at present for a new production facility. She was able to obtain the following labor and material cost data: Labor costs: Annual labor costs for a similar facility were P500,000 ten years ago. Labor cost index was at 124 ten years ago and is 188 today Material costs: Annual material costs for a similar facility were P2,000,000 three years ago. Material cost index was at 544 three years ago and is 715 today. Using her obtained cost data, what should be her estimate on the following? a) Estimated annual labor cost of the new production facility at present b) Estimated annual material cost of the new production facility at present
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