5-52 train - Decide whether to take 30 tourists on a train...

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Car Decide whether to take 30 tourists on a train car that is either attached to an existing train ($15 ea for each tourist) or attached to a dedicated train ($32 ea for each tourist). The car carrying the tourists needs to be moved from the yard at a cost of $40. The tour needs a tour guide that costs $150. The cost of an Engineer is $400. Adding the car to an existing train will cause an additional $20 in fuel cost. Fuel cost for a dedicated train would be $150. What are the relevant costs? Which is the best decision?
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Existing Train 5-55 Train Yard CAR
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Existing Train 5-55 Train Yard CAR New Dedicated Train
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Existing Train Car New Dedicated Train Tour Guide Engineer
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Relevant Data Added Revenue $510? Move Car $40? Engineer $400? Tour Guide $150? Added Fuel $130?* Depreciation $5000? Decision: Having Car Added to a Dedicated Train vs Adding Car to Existing Train Existing Train Car New Dedicated Train 5-55 Tour Guide Engineer *$0.20 per mile vs. $2.20 a
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This note was uploaded on 11/16/2010 for the course ECN 5050 taught by Professor Yamashita during the Spring '10 term at Nova Southeastern University.

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5-52 train - Decide whether to take 30 tourists on a train...

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