2.2 - Operating Cost
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Practice Questions
Test your understanding with targeted questions
What are the main components of operating costs?
💡 Hint: Remember the acronym FMLM.
Define the Peurifoy Method.
💡 Hint: Think about 'time value' in its definition.
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Interactive Quizzes
Quick quizzes to reinforce your learning
What does the Caterpillar method primarily focus on?
💡 Hint: Consider what this method is used for in construction.
The Peurifoy method considers what key financial concept?
💡 Hint: Focus on how time affects cost estimation.
1 more question available
Challenge Problems
Push your limits with advanced challenges
You have an excavator with a purchase price of $200,000, a salvage value of $20,000, and a tire cost of $10,000. It has an estimated lifespan of 15,000 hours. Calculate the hourly depreciation.
💡 Hint: Step through the formula, subtract first before dividing.
Discuss the potential financial impact of inaccurately estimating fuel consumption based on performance handbooks.
💡 Hint: Consider both sides of the estimation inaccuracies.
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