Suppose that the crash cost is $10 million, normal cost is $8 million, normal project time is 10 years and crash time is 8 years, what is the project's crash cost per year?
A)$1 million
B)$2 million
C)$3 million
D)$4 million
E)$5 million

Question

Quizplus · Accepted Answer

The crash cost per year is (Crash cost - Normal cost) / (Normal project time - Crash time) = ($10 million - $8 million) / (10 years - 8 years) = $2 million / 2 years = $1 million per year.

Suppose That the Crash Cost Is $10 Million, Normal Cost