economic project

please check the attached files to see the Question paper.

*Notice : when you finish from my assignment i have to submit in turnitin and that website its looking or searching in my assignment words if i taken from any resource of ( internet, students , books, newspaper …) so you have be careful in that to not become higher then 15%

*Notice: put citation in discussion and add references in Harvard Style also index please.

1- The summery of project.

A- introduction : what to do ?

B-Discussion : Why we did this project.

C- Conclusion : We want to do ….. Based on discussion .


A company is considering the manufacture of a specialty chemical for use the synthetic fiber industry. An outside consulting firm has estimated that a fixed capital investment of $15MM will be required to manufacture 18 MM lb of product annually. The marketing department believes that a selling price of 70 cents/lb would be competitive with similar products in the market place. You may assume that all product made is sold.

The following information is available:

Raw material costs

8.9 cents/lb


5.6 cents/lb


4 operators per shift around the clock


10% of labor

Fringe benefits

40% of labor plus supervision

Laboratory charges

15% of labor


6% FCI/yr

Waste disposal charges

4.0 cents/lb

All other direct expenses may be assumed to be average


5 yr straight-line

Plant indirect expenses

2% FCI/yr

Packaging and shipping expenses

0.4 cents/lb

General overhead expenses

8% of annual sales

Working capital

15% TCI

Neglect start-up expenses



a. Total operating expense report

b. Estimate of capital requirements

c. Net profit after taxes

d. Based upon your calculations, what recommendations could you make to management concerning this proposed venture? Be sure to substantiate your answer(s) with numbers and Figures.

e. If the company decided to have a loan to execute this project, suggest the following:

1. The amount of the loan in Dollars

2. The project Duration and

3. The loan Pay off strategy and period

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