Question 3 :
A package delivery company is contemplating building a newshipping center. The most recent shipping center, 10,000 squarefeet large, was built in 2005, at a cost of $500,000. The newshipping center will be 15,000 square feet large. Using thepower-sizing cost-estimating model, estimate the cost of building anew shipping center now, using the assumptions below to construct aweighted cost index value for 2005 and for today. Use 0.90 for thecost-capacity factor. The dollar cost of building a shipping centercan be broken down into the cost of labor (20%), materials (35%),and equipment (45%). The cost index for labor is 120 in 2005, and150 today. The cost index for materials is 180 in 2005 and 170today. The cost index for equipment is 140 in 2005 and 200today.
Question 4 Milana just deposited $10,000 in her account.Assuming the annual interest rate is 8%, how many years will ittake before her account balance reaches $23,000? (Please make sureyou use the time value of money Excel functions)
