Economics Homework Help
Economics Homework Help. University of California Energy Efficient Model Questions
Most appliance manufacturers produce conventional and energy-efficient models. The energy- efficient models are more expensive to make but cheaper to operate. The costs of purchasing and operating a 36,000-Btu central air conditioner of each type are given in the Table. These costs do not include maintenance charges or changes in electricity prices.
Table
Energy-Efficient Model
Conventional Model
Initial Cost
$4, 000
$2, 700
Capacity
36, 000 Btu
36, 000 Btu
Annual Cost of Electricity
$932
$1, 332
1. Express the total cost Ce(x) and the average cost C ?e(x) = (1/x) Ce(x) of purchasing and operating
an energy-efficient model for x years.
2. Express the total cost Cc(x) and the average cost C ?c(x) = 1/x Cc(x) of purchasing and operating
a conventional model for x years.
3. Are the total costs for an energy-efficient model and for a conventional model ever the same? If so, when?
4. Are the average costs for an energy-efficient model and for a conventional model ever the same? If so, when?