So, let's assume that warehouse that had been

built in 1978 has around 120,000 square feet of usable area.

The prospective owner for the new warehouse,

wants a structure with a usable area of 150,000 square feet.

So in this case, why I combine them both because in this

kind of equation we want them to use the cost indices

approach to adjust for the time differences and adjust for

the cost from 1978 to let's say 2013.

Based on the cost indices Example number 2.

And we want to adjust on the capacity, and the change here

in this question, the change in the size of the project.

So what we will be doing is C2,

the cost estimated that we're trying to find or

figure out, we highlight the cost index,

which is the 5,317 divided 1,674 from 1978.

If you remember,

these are the numbers we got from example number 2 from the cost indices.

And we multiplied by the cost capacity factor,

which is the 150,000 divided by the old

capacity in 1978 was built the 120,000 and

you have that by the power of x which is the 0.8 which

is the cost capacity factor for this type of project.