Practice - Module 2 - Estimation of the Cost Associated with the Equipment
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Practice Questions
Test your understanding with targeted questions
What are owning costs?
💡 Hint: Consider what you pay just to have the equipment.
Name one method of estimating equipment costs.
💡 Hint: Think about the average over time.
4 more questions available
Interactive Quizzes
Quick quizzes to reinforce your learning
What are the two major components of equipment costs?
💡 Hint: Think about what costs are incurred just to own versus to operate.
True or False: Accurate cost estimation is essential for effective project planning.
💡 Hint: Consider the planning phase of a project.
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Challenge Problems
Push your limits with advanced challenges
A contractor estimates to purchase a concrete mixer for $80,000 with a useful life of 10 years. Calculate the straight-line depreciation and total owning costs if the annual operating costs are projected at $5,000.
💡 Hint: What is the formula for straight-line depreciation?
A company must decide between two excavators. Excavator A costs $250,000 with operating costs of $25,000, while Excavator B costs $400,000 but has operating costs of $15,000. If their economic lives are both 15 years, which excavator should the company choose based on total cost estimation?
💡 Hint: List both owning and operating costs over their lifetimes.
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