Question

6) A trade magazine publishes lists of power-sizing exponents that reflect economies of scale for developing engineering estimates of various types of equipment. There are two pieces of similar machinery, the StottViking 100 and the StottViking 50. The 100 model produces twice the ouput (volume) as the 50 model. The cost of the 50 model was $95,000 five years ago, and the cost of the 100 model is $250,000 today. . There is a cost index documenting price changes of the StottViking over time-the index is 350 today and was 235 five years ago. What is the power sizing exponent for the StottViking machine the publisher should print in their trade magazine? a. 0.3 b. 0.5 c. 0.57 d. 0.82