Two types of engines are considered for use in Small Airplanes. Each has the same service life and the same O&M. Type A
Posted: Thu May 05, 2022 6:57 am
- Two Types Of Engines Are Considered For Use In Small Airplanes Each Has The Same Service Life And The Same O M Type A 1 (146.93 KiB) Viewed 34 times
Two types of engines are considered for use in Small Airplanes. Each has the same service life and the same O&M. Type A costs $150000 and uses 40000 gallons per 1000 hours of operation at the average load encountered in passenger service. Type B costs $250000 and uses 32000 gallons per 1000 hours of operation at the same level. Both engines have three-year lives and 7% of the initial cost's salvage value. Also, the jet fuel currently costs $3.10 a gallon and fuel consumption is expected to increase at the rate of 6% per year because of degrading engine efficiency. Using AE, AEC criterion, What engine should be used? Assume 2000 hours of operation per year and a MARR of 15%. Fully explain your answers and fully justify your selection. what is the equivalent operating cost per hour for each engine?