+ Reply to Thread
Results 1 to 3 of 3

Economy of scale curve

  1. #1
    Registered User
    Join Date
    06-06-2010
    Location
    USA
    MS-Off Ver
    Excel 2007
    Posts
    3

    Economy of scale curve

    I am developing tools to help do preliminary estimates of remodeling projects. By it's nature, a smalle project will cost more / square foot than a larger one. Lets take a deck as an example: I have a 100 sf deck that I've completed that cost $40/sf, a 200 sf deck that cost me $20/sf and a 400sf deck the cost me $15/sf, (A,B,C). (We can assume that the smallest deck I would ever build would be 50sf and the largest would be 2000sf). These knowns, will create a curve on a graph. The curve will generally look like the attached spreadsheet. It will never touch the x or y axis. The A, B and C points will all be related so the curve shouls have a shape similar to the image.

    Assuming that I know A,B &C and I have a minimum and maximum size, what formula would I need to calculate what a 325sf deck would cost, or any other size deck between the smallest and largest parameters?
    Attached Files Attached Files

  2. #2
    Forum Expert shg's Avatar
    Join Date
    06-20-2007
    Location
    The Great State of Texas
    MS-Off Ver
    2003, 2010
    Posts
    40,678

    Re: Economy of scale curve

    Welcome to the forum.

    If this were actually about building decks, I'd suggest that you construct a model that includes variable and fixed costs, and see how total cost varies by size.

    For the general case, see sites like http://www.business-analysis-made-ea...readsheet.html.
    Entia non sunt multiplicanda sine necessitate

  3. #3
    Registered User
    Join Date
    06-06-2010
    Location
    USA
    MS-Off Ver
    Excel 2007
    Posts
    3

    Re: Economy of scale curve

    Thanks, This Helps!

+ Reply to Thread

Thread Information

Users Browsing this Thread

There are currently 1 users browsing this thread. (0 members and 1 guests)

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts

Search Engine Friendly URLs by vBSEO 3.6.0 RC 1