Final Exam Bda40902 Ee Sem1 2022-2023 Ans
Final Exam Bda40902 Ee Sem1 2022-2023 Ans
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Q1 (a) State the diffence between sequential and concurrent engineering and list out
THREE (3) benefits of concurrent engineering concept.
(5 marks)
Sequential engineering, is the process of marketing, engineering design,
manufacturing, testing and production where each stage of the development process
is carried out separately, and the next stage cannot start until the previous stage is
finished while concurrent engineering is a systematic approach to the integrated,
concurrent design of products and their related processes, including manufacture and
support (2 marks)
(b) A university lab is a research contractor to MOSTI for in-space fuel cell systems that
are hydrogenand methanol-based. During lab research, three equal-service machines
need to be evaluated economically. The MARR is 10% per year.
Table Q1(b)
(i) Draw a cash-flow diagram for each of the fuel cell system
(9 marks)
Each cash flow diagram (3 marks)
(ii) Determine the present worth (PW) analysis for each of the fuel system with
the costs shown above in Table Q1(b).
(9 marks)
PWE = - 4500 - 900(P/A, 10%, 8) + 200(P/F, 10%, 8) = RM – 9,208
(3 marks)
PWG = - 3500 - 700(P/A, 10%, 8) + 350(P/ F, 10%, 8) = RM – 7,071
(3 marks)
PWS = - 6000 - 50(P/A, 10%, 8) + 100(P/F, 10%, 8) = RM – 6,220 (3 marks)
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Q2 (a) Identify each of the following cash flow to indicate whether it is a benefit, a
disbenefit, or a cost.
(i) Most Malaysian eat a diet rich in heavily processed foods which have been
made from synthetic ingredients, and packed with fat, sugar, sodium,
chemicals, preservatives, food dyes and other additives which may be
detrimental to your overall health and well-being.
(1 mark)
Disbenefit
(ii) Last month’s floods led to about RM2.6 billion in damage to houses,
household possessions and vehicles, the department of statistics said.
(1 mark)
Cost
(iii) No matter what type of trail you find yourself on, hiking is a great whole-
body workout from head to toe and everything in between.
(1 mark)
Benefit
(iv) Playing badminton boosts up the muscle strength making you strong and fit,
(1 mark)
Benefit
(b) A new project has been proposed by UTHM management to develop UTHM
Aeronautic Technology Center at Tanjung Laboh, Batu Pahat Johor, for teaching and
learning (T&L) courses related to Bachelor of Aeronautical Engineering Technology
(Professional Piloting) with Honours. The land acquisition is estimated to be RM 0.7
million. Construction cost for the Aeronautic Technology Center is expected to be
RM 1.2 million with an additional annual maintenance cost of RM 80,000. Finally,
the Aeronautic Technology Center project will require an additional operation cost
with an annual cost of RM 36,000. By realizing this, it is estimated that the number
of students will increase and consequently giving more benefits via payment of
student fees of RM 400,000/year. In addition, the center will also be benefited from
the research grand awarded worth RM 90,000/year as well as providing convenient
research placed for UTHM community worth RM 35,000/year. Apply the B/C ratio
method for both conventional and modified cases using PW and AW method with a
study period of 10 years and MARR of 12% per year to justify whether the
Aeronautic Technology Center should be initiated or not.
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PW(MW) = 0
(1 marks)
(1 marks)
(1 mark)
PW = 1.161 (1 mark)
(1 marks)
(1marks)
(1 mark)
PW = 1.216 (1 mark)
(1 marks)
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(1marks)
(1 mark)
AW = 1.161 (1 mark)
(1 marks)
(1 marks)
(1 mark)
AW = 1.216 (1 mark)
Q3 (a) An asset which has a first cost of RM 40,000 is expected to have an annual operating
cost of RM 15,000 per year. It will provide the needed service for a maximum of 6
years. If the salvage value changes as shown below, determine the economic life of
the asset at 20% per year.
Table Q3(a)
(10 marks)
Solve for the AW of the asset for year 1 thru 5 and then pick the lowest
value to determine the economic life.
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(b) A furniture company intends to evaluate whether they want to stick with the existing
equipment (defender) or replace them with the new productive equipment
(challenger). The details of the cost required are shown in Table Q3(b) below. Use
an interest rate of 20% per year.
Table Q3(b)
(i) Use the replacement analysis to justify whether the existing equipment is
required to be replaced with the new equipment.
(10 marks)
i = 20% per year
0 1 5
P = 25,000
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A = 160,000 (2.5m)
0 1 10
P = 700,000
A = 70,000 (2.5m)
OR
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Q4 (a) Identify each of the following cash items whether it is fixed cost, variable cost, sunk
cost, opportunity cost or implicit cost.
(i) You spend RM 30,000 to train your staff on how to use the new software you
have installed on your company's computers.
(1 mark)
Sunk cost
(iv) A student spends three hours and RM 20 at the movies the night before an
exam.
(1 mark)
Opportunity cost
(v) Payments that you can earn from a rented property and annual cash flow from
stock sales
(1 mark)
Implicit cost
(b) Bridal Shoppe sells wedding dresses. The cost of each dress is comprised of the
following cost items shown in Table Q4(b).
Table Q4(b)
COST ITEMS RM
1. Selling price 1,000
2. Variable (flexible) cost 400
3. Fixed (capacity) cost 90,000
(i) Determine the Bridal Shoppe’s total profit when 200 dresses are sold
(2 marks)
Profit = TR – TC = PQ – (FC + VCQ)
= 1,000 (200) – (90,000 + 400[200])
= 200,000 – 170,000 = RM 30,000
(ii) Determine how many dresses must Bridal Shoppe sell to yield a profit of
RM60,000?
(2 marks)
Profit = TR – TC = PQ – (FC + VCQ)
60,000 = 1,000Q – (90,000 + 400Q)
60,000 = 600Q - 90,000
600Q = 150,000
Q = 250 dresses
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(iii) Evaluate how will the company’s viability if the sales price increases by
RM100 per dresses (10 percent) but the demand for the dresses slightly drop
by 20% from Q4(b)(ii) due to the increment of price.
(6 marks)
Demand = 250(0.8) = 200 dresses (1)
Profit = TR – TC = PQ – (FC + VCQ)
= 1100(200) – (50,000 + 400(200)) = 220,000 – 130,000
= 90,000 (1)
Profit = TR – TC = PQ – (FC + VCQ)
= 1000(200) – (50,000 + 400(200)) = 200,000 – 130,000
= 70,000 (1)
90,000 – 70,000 = 20,000 which is (20,000/90,000) x 100 = 22.22% (1). The
increasing price by 10 percent will increase the profit by 22.2 percent
(22,000). The company still having a profit even though there is a slight
drop in demand due to the increment of price (1). Thus profit is highly
sensitive to changes in sales price. (1)
(c) Star Symphony would like to perform for a neighboring city. Fixed costs for the
performance total RM 5,000. Tickets will sell for RM 15 per person, and an outside
organization responsible for processing ticket orders charges the symphony a fee of
RM 2 per ticket. Star Symphony expects to sell 500 tickets.
(i) Determine how many tickets must Star Symphony sell to break even.
(3 marks)
BEP = TR = TC
PQ = FC + VCQ
15Q = 5,000 + 2Q
13Q = 5,000
Q = 384.6 = 385
(ii) Calculate how many tickets must the symphony sell to earn a profit of RM
7,000.
(3 marks)
Profit = TR – TC = PQ – (FC + VCQ)
7,000 = 15Q – (5,000 + 2Q)
7,000 = 13Q - 5,000
13Q = 12,000
Q = 923.07 = 923 tickets
(iii) Determine how much must Star Symphony have in sales to break even.
(2 marks)
TR = Sales = PQ = 15(384.6) = RM 5,769
(iv) Calculate how much must Star Symphony have in sales to earn a profit of
RM 7,000?
(2 marks)
TR = Sales = PQ = 15(923.07) = RM 13,846
Q5 (a) Naza Automotive Manufacturing Sdn. Bhd. needs a RM 1 million balance in its
contingency fund 3 years from now. The CFO (Chief Financial Officer) wants to
know how much to deposit now into Naza’s high-yield investment account.
Determine the amount if it grows at a rate of 20% per year.
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A=RM 20,000
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22
1 1 1 1 1 1 1 1 1 1 1
i = 15%
(5 marks)
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- END OF QUESTION –
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FINAL EXAM
SEMESTER/SESSION : SEM I / 2022/2023 PROGRAMME CODE: BDD
COURSE NAME : ENGINEERING ECONOMY COURSE CODE: BDA40902
LIST OF FORMULA
5 13
6 14
7 15
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FINAL EXAM
SEMESTER/SESSION : SEM I / 2022/2023 PROGRAMME CODE: BDD
COURSE NAME : ENGINEERING ECONOMY COURSE CODE: BDA40902
INTEREST TABLE
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FINAL EXAM
SEMESTER/SESSION : SEM I / 2022/2023 PROGRAMME CODE: BDD
COURSE NAME : ENGINEERING ECONOMY COURSE CODE: BDA40902
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FINAL EXAM
SEMESTER/SESSION : SEM I / 2022/2023 PROGRAMME CODE: BDD
COURSE NAME : ENGINEERING ECONOMY COURSE CODE: BDA40902
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CONFIDENTIAL BDA40902
FINAL EXAM
SEMESTER/SESSION : SEM I / 2022/2023 PROGRAMME CODE: BDD
COURSE NAME : ENGINEERING ECONOMY COURSE CODE: BDA40902
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