# CEU Exam: Life-Cycle Costing: Essential Medicine for Surviving the Recession

Every industrial operation is under pressure to cut production costs and improve its bottom line. Many short-term spending cuts are painful, and they typically ignore long-term cost issues that are bleeding some companies to death during this prolonged economic downturn.

This webcast will help you identify immediate and straightforward opportunities to help your plant get through to better times. Plant Engineering Editor Bob Vavra and experts from the ITT Industrial Process group will share an overview of a life-cycle costing formula and specific thoughts on ways to improve your bottom line. They will provide best-practice benchmarks for managing three critical factors that significantly influence the total cost of ownership for equipment, and the total operational costs for a manufacturing plan

• Energy Consumption
• Maintenance Expense
• Inventory Management

By applying the same costing methods and operational practices in these areas as manufacturing leaders, attendees will learn how to survive and even improve profitability during the recession.

You must get 5 out of 8 questions correct in order to pass the CEU Exam for this webcast. You will be notified whether you passed or failed automatically after taking the exam. Upon passing the exam, a hardcopy certificate will be mailed within 30 days to you at the address you provide below.

Name *
Question 1 *

Total Cost of Ownership for a piece of equipment on your plant floor is calculated as:

Initial cost minus depreciation
The full purchase price of the equipment plus operating costs
The cost to purchase, install, operate and maintain equipment through disposal
Question 2 *

According to the Webcast, the cost to maintain and repair a pump is:

Greater than the cost of energy to run it
Double the initial cost of the of the equipment
Less than the cost of downtime and operation combined
Question 3 *

A Finnish study of pump efficiency shows that the average pumping efficiency is

Below 40%
Between 40% and 50%
Between 50% and 60%
Question 4 *

Which is NOT considered a contributing factor to a high total cost of ownership?

A predictive maintenance program
Poor operating practices
Poor morale or a culture of entitlement
Question 5 *

By calculating OEE, a manufacturer can calculate:

The equipmentâ€™s operating efficiency
The value of that operating efficiency in real dollars
Both
Question 6 *

Inventory value AND inventory carrying costs are both factors in calculating the total savings potential in OEE?

True
False
Question 7 *

In a real-life case study, a paper mill was able to save money with a pump study. What other benefit did they obtain?

Lower on-site spare parts inventory
Better control of energy costs
Lower paper manufacturing costs
Question 8 *

Thanks to a Root Cause Failure Analysis, a refiner was able to reduce repair costs by:

60%
75%
85%