Practice Storage Costs - 2.3 | 7. Cost of Investment | Construction Engineering & Management - Vol 1
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Knowledge

2.3 - Storage Costs

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Learning

Practice Questions

Test your understanding with targeted questions related to the topic.

Question 1

Easy

Define investment costs in your own words.

💡 Hint: Think about purchase and any associated interest.

Question 2

Easy

What are storage costs?

💡 Hint: Consider maintenance and security.

Practice 4 more questions and get performance evaluation

Interactive Quizzes

Engage in quick quizzes to reinforce what you've learned and check your comprehension.

Question 1

What represents the annual cost of capital invested in a machine?

  • Operating Cost
  • Investment Cost
  • Maintenance Cost

💡 Hint: Refer back to the definition of investment costs we discussed.

Question 2

True or False: The Average Annual Investment Method accounts for cash flow timings.

  • True
  • False

💡 Hint: Remember our segmentation of these two methods.

Solve 1 more question and get performance evaluation

Challenge Problems

Push your limits with challenges.

Question 1

A construction company buys a crane for $120,000 and expects a salvage value of $15,000 after 10 years. Calculate the average annual investment. Discuss implications on project costs if this calculation is incorrect.

💡 Hint: Utilize the average annual investment formula from our last class.

Question 2

A project manager mistakenly underestimates the storage costs of machinery. What steps should they take to reassess and correct the budget?

💡 Hint: Revisit the cost components we discussed and analyze each.

Challenge and get performance evaluation