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Costs and Investment in Projects - Coggle Diagram
Costs and Investment in Projects
Main Node: Investment Costs
Definition: Initial investment required for the project.
Components:
Acquisition of properties
Purchase of machinery and equipment
Intangible assets
Working capital
Investment Table:
Civil works
Equipment and import expenses
Installation, assembly, and startup costs
Working capital
Other investments
Disbursement schedule
Main Node: Operating Costs
Definition: Resources required for project operation.
Types:
Fixed Costs: Independent of production levels (e.g., salaries, rent, insurance).
Variable Costs: Depend on production levels (e.g., raw materials, energy, labor).
Key Expenses:
Direct and indirect labor
Electricity and utilities
Equipment maintenance
Taxes and fees
Objective:
Calculate costs to determine profitability.
Identify break-even point.
Main Node: Unit Costs
Definition: Cost per unit of production.
Formula:
Total Cost (TC) = Fixed Costs (FC) + Variable Costs (VC)
Unit Variable Cost (UVC) = Total Variable Cost (TVC) / Number of Units (n)
Factors Affecting Unit Costs:
Production level
Fixed and variable expense structure
Main Node: Investment Portfolio Analysis
Purpose: Evaluate different investment alternatives.
Considerations:
Risk and return
Capital allocation
Cost-benefit analysis