Question

In: Economics

The gravity on Mars is 3.711 m/s². Since you came from the Moon previously, where gravity is 1.62 m/s², you have tiny leg muscles.

The gravity on Mars is 3.711 m/s². Since you came from the Moon previously, where gravity is 1.62 m/s², you have tiny leg muscles. Not only do you look funny but walking around is a struggle. You want a Mars hopper to take you around and there are two propellant options, hypergolic and LOX-hydrocarbon. You will use the vehicle on average 50,000 km per year, with a useful life of 3 years for the LOX engine and 4 years for the Hypergol. INTEREST is 10% per year. Other comparative information is as follows:


LOX

Hypergol

Vehicle Cost

$13,000

$12,000

Fuel per liter

$0.48

$0.51

Mileage in km/liter

35

28

Annual maintenance

$300

$200

Annual operating costs

$500

$500

Resale Value

2180

200

Enter the difference between the two options in AW:

Solutions

Expert Solution

*We will use vehical on average 50000km per year so the total cost of fuel consumed is given under:-

(a) in case of hypergolic engine=50000*$0.51=$25500

(b) in case of Lox engine=50000*0.48=$24000

* mileage in km/liter

(a) in case of hypergolic engine =28

(b) in case of Lox engine =35

* annual mainteance

(a) in case of hypergolic engine =$200

(b) in case of Lox engine =$300

*annual operating cost

(a) in case of hypergolic engine =$500

(b) in case of Lox engine=$500

*resale vaue

(a) in case of hypergolic engine =$200

(b) in case of Lox engine =$2180

* annual intesrest is 10%

(a) in case of hypergolic engine=$12000*10/100=$1200

(b) in case of Lox engine =$13000*10/100=$1300

*life

(a) in case of hypergolic engine =3 year

(b) in case of Lox engine =4 year

So total cost occurred:-

(a) in case of hypergolic engine =$1200+$25500+$200+$500=27400*3 year=$82200-$200=$80000

(b) in case of Lox engine =$1300+$24000+$300+$500=26100*4 year=$104400-$2180=102220

So we see that there lox engine is better than hypergolic engine because its life is 4 year and and hypergolic's life is 3 year and rasale vale is also hreater than hypergolic engine which $2180 and its mileage and fuel cost is also better than hypergolic engine mileage per km is 35 and fuel cot is $0.48.so Lox engine is better than hypergolic engine.


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