Summary of the factorial method

Many variations on the factorial method are used. The method outlined below can be used with the data given in this chapter to make a quick, approximate, estimate of the investment need for a project. 

Prepare material and energy balances, draw up preliminary flow-sheets, size major equipment items and select materials of construction. 

Calculate the total physical plant cost (PPC), using the factors given in Table 6.1 

The direct plus indirect costs give the total fixed capital. 

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