Practice Economic Life - 7.3 | 15. Equipment Life and Replacement Analysis (Part-1) | Construction Engineering & Management - Vol 1
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Knowledge

7.3 - Economic Life

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Learning

Practice Questions

Test your understanding with targeted questions related to the topic.

Question 1

Easy

Define 'economic life' in the context of construction equipment.

💡 Hint: Think about the relationship between cost and machine usage.

Question 2

Easy

What is the difference between defender and challenger?

💡 Hint: Consider which machine is being used and which one is being considered.

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 is the primary goal of replacement analysis?

  • Maximizing repair costs
  • Minimizing operational downtime
  • Optimizing equipment replacement timing

💡 Hint: Consider what we are trying to achieve with replacement decisions.

Question 2

True or False: Economic life ends when equipment can no longer operate.

  • True
  • False

💡 Hint: Think about cost relationships, not just equipment function.

Solve and get performance evaluation

Challenge Problems

Push your limits with challenges.

Question 1

Calculate the economic life of a piece of equipment that has an initial cost of $100,000, an increasing repair cost of $10,000 annually, and expected returns decreasing by $5,000 per year.

💡 Hint: Set up an equation where total returns minus total costs gives you the breakeven point.

Question 2

A construction company has two excavators: one (old) incurs high repairs costing $15,000 annual, while the other (new) has a lower repair cost of $5,000 and higher efficiency. Discuss whether to replace the old one.

💡 Hint: Think about long-term cost versus short-term savings.

Challenge and get performance evaluation