Department of Civil and Environmental Engineering

GDB 3023 ENGINEERING ECONOMY AND

ENTREPRENEURSHIP
JAN 2020

ASSIGNMENT 3
Group 19
Name ID
WONG KAI WING 23874
MUHAMMAD AFIQ AIMAN BIN MOHD 23930
ZAHID
NG YEE YONG 23946
RAY LOUIS VICMARK RICHARD 23933
NURBAZILAH BINTI AZMI 23867
3-6
(a) Standard electric bill = (400kWh)(12months/year)(0.10/kWh) = 480 per year
Green power bill = (4/month)(12months/year) = 48 per year
Total electric bill = 480+48 = 528 per year

(b) 528/4800 kWh = 0.11 per kWh

(c) The technology used to produce green power is more expensive than produce
conventional power.

3-11
Let, CA = cost of new boiler
CB = cost of old boiler

SA = 1.42X
SB = X
221
C B=181000 =246920
162

(1.42 X )0.8
C A=246920 =326879
162
Total cost with options = 326879 + 28000 = 354879
3-21

i Area (x) Cost(y) x2 xy

1 14,500 800,000 210,250,000 11,600,000,000
2 15,000 825,000 225,000,000 12,375,000,000
3 17,000 875,000 289,000,000 14,875,000,000
4 18,500 972,000 342,250,000 17,982,000,000
5 20,400 1,074,000 416,160,000 21,909,600,000
6 21,000 1,250,000 441,000,000 26,250,000,000
7 25,000 1,307,000 625,000,000 32,675,000,000
8 26,750 1,534,000 715,562,500 41,034,500,000
9 28,000 1,475,500 784,000,000 41,314,000,000
10 30,000 1,525,000 900,000,000 45,750,000,000
Totals 216,150 11,637,500 4,948,222,500 265,765,100,000

( 10 )( 26765100000 )−( 216150 )( 11637500 )

b 1=
( 10 ) ( 4948222500 ) −( 216150 )2

b 1=51.5

11637500−(51.5)(216150)
b 0=
10
b 0=50631

(a) Cost = 50631 + 51.5x

Thus, estimated cost for the 23000 ft2 store is

Cost = 50631 + 51.5(23000) = 1235131
 (b)

i xi yi Costi (yi - Costi)2 (xi - x́ )( yi - ý ) (xi - x́ )2 (yi - ý )2

1 14,500 800,000 797,345 7,048,179 2,588,081,250 50,623,225 132,314,062,500
2 15,000 825,000 823,094 3,633,147 2,240,831,250 43,758,225 114,751,562,500
3 17,000 875,000 926,089 2,610,081,256 1,332,581,250 21,298,225 83,376,562,500
4 18,500 972,000 1,003,335 981,896,725 597,301,250 9,703,225 36,768,062,500
5 20,400 1,074,000 1,101,181 738,780,429 109,046,250 1,476,225 8,055,062,500
6 21,000 1,250,000 1,132,079 13,905,356,010 -53,043,750 378,225 7,439,062,500
7 25,000 1,307,000 1,338,069 965,288,881 484,901,250 11,458,225 20,520,562,500
8 26,750 1,534,000 1,428,190 11,195,807,942 1,901,233,750 26,368,225 137,085,062,500
9 28,000 1,475,500 1,492,562 291,099,988 1,990,523,750 40,768,225 97,188,062,500
10 30,000 1,525,000 1,595,557 4,978,246,304 3,029,081,250 70,308,225 130,501,562,500
∑ 216,150 11,637,500 11,637,500 35,677,238,861 14,220,537,500 276,140,250 767,999,625,000

216150
x́= =21615
10
11637500
ý= =1163750
10

356777238631
Standard Deviation =
√ 8
=66780

14220537500
Correlation coefficient, R = =0.98
√(276140250)(767999625000)
3-22
Let, xi = weight of order
yi = packaging and processing costs 300

i x y x2 y2 xy
1 230 97 52900 9409 22310
2 280 109 78400 11881 30520
3 210 88 44100 7744 18480
4 190 86 36100 7396 16340
5 320 123 102400 15129 39360
6 300 114 90000 12996 34200
7 280 112 78400 12544 31360
8 260 102 67600 10404 26520
9 270 107 72900 11449 28890
10 190 86 36100 7396 16340
Totals 2530 1024 658900 106348 264320

2350
x́= =253
10
1024
ý= =102.4
10
(a)
( 264320 ) −(253)(1024)
b 1= =0.279
( 658900 )−( 253)(2530)

b 0=102.4−(0.279)(253)=31813

Linear progression equation, y = 31813 + 0.279x

(b) Sxy = 264320 – (2530)(1024)(10) = 5248

Sxx = 658900 – (2530)2/10 = 18810
Syy = 106348 – (1024)2/10 = 1490.4

5248
R= =0.99
√(18810)(1490.4)
(c) y = 31813 + 0.279(250) = 101.56
3-27
Table below shows the estimated 2016 cost for building the coal-fired generating facility.
Element Code Units/Factors Price/Unit Subtotal Total
1.1.1 & 1.1.2 600 $ 2,000 $ 1,200,000  
1.1.3   $ 3,000,000
$
1.1    
4,200,000
       
1.2 & 1.3 2.3969 a $ 110,000,000 $ 263,656,272 $ 263,656,272
       

1.4 4.4727 $ 5,000,000 $ 22,363,636 $ 22,363,636

1.5.1, 1.5.2 &

     
1.5.3
Labor 80,390 c $ 60 $ 4,823,374  
Materials   $ 15,000,000  
1.5.4 600 $ 1,500 $ 900,000  
$
1.5    
20,723,374
   
 
1.9 3% $ 310,943,282 $ 9,328,298 $ 9,328,298
TOTAL ESTIMATED COST IN 2016 $ 320,271,581

a
Factor value for boiler (1.2) and boiler support system (1.3)
I1993 = 110
I2016 = 492
X = 0.9
1
Size of plant 2016 to 1993 =
2
0.9
492 1
Factor value = ( )( )
110 2
= 2.3969
b
Factor value for the coal storage facility (1.4)
I1993 = 110
I2016 = 492

Factor value = ( 492

110 )

= 4.4727
c
Labor time estimate for the support facilities and equipment (1.5.1, 1.5.2 & 1.5.3)

Zu = K ( un )

Assume this is the third generating plants:

u=3
K = 95,000 hours
s = 0.9
log s
n=
log 2
log0.9
Z3 = 95,000 3 ( log 2 )
= 80,390 hours

Therefore, the estimated cost for building the coal-fired facility in 2016 is $ 320,271,581.