Calculate the annual cost of each motor

Assignment Help Operation Management

Reference no: EM131857525

A manufacturing company is considering purchasing a 10 HP electric motor which it estimates will run an average of 6 hours per day for 250 days per year.

Past experience indicates that:

(1) its annual cost for taxes and insurance averages 2.5% of first cost,

(2) it must make 10% on invested capital before income tax considerations, and

(3) it must recover capital invested In machinery within 5 years.

Two motors are offered to the company. Motor A. costs $340 and has a guaranteed efficiency of 85% at the indicated operating load. Motor B costs $290 and has a guaranteed efficiency of 80% at the same operating load.

Electric energy costs the company 2.3 cents per KW-hr. Calculate the annual cost of each motor and indicate which motor should be purchased.

Reference no: EM131857525

Questions Cloud

Survey a portion of the milky way galaxy : NASA's Kepler Mission is a mission that was launched to survey a portion of the Milky Way galaxy in order to discover Earth-sized planets

Would you recommend using this order quantity : How many times a year are orders placed, and what is the average time, in weeks, between orders? Using the answer from

A distribution center in each region : A manufacturer sells a product in two regions. Weekly demand in each region is Normally distributed with mean 1,000 and standard deviation 300.

How recursive function might cause stack overflow exception : What three things are stored in an activation frame? Where are activation frame stored? Explain how a recursive function might cause a stack overflow exception.

Calculate the annual cost of each motor : A manufacturing company is considering purchasing a 10 HP electric motor which it estimates will run an average of 6 hours per day for 250 days per year.

Evaluate the conduct of peter lewiston against the eeocs : Evaluate the conduct of Peter Lewiston against the EEOC's definition of sexual harassment.

Simulate the operation of a bank : Simulate the operation of a bank. Customers enter the bank, and there are one or more tellers. If a teller is free, that teller serves the customer.

Circumferences of the two orbits : Eclipsing Binary I. If an eclipsing binary has a period of 32 days, and the two components are in circular orbits around their center of mass with speeds

Solve the optimization problem using graphical optimization : A manufacturer of a particular product produces x1 units in the first week and x2 units in the second week.

User Account

All Pages