A company is considering buying a new piece of machinery. The initial cost of the machine is 80,000 and its salvage value is 20,000 at the end of 20 years. Annual operating cost is 18,000. What is the equivalent uniform annual cost of the machine based on 10% interest rate?

A company is considering buying a new piece of machinery. The initial cost of the machine is 80,000 and its salvage value is 20,000 at the end of 20 years. Annual operating cost is 18,000. What is the equivalent uniform annual cost of the machine based on 10% interest rate?

Fundamentals Of Construction Estimating

4th Edition

ISBN:9781337399395

Author:Pratt, David J.

Publisher:Pratt, David J.

Chapter9: Pricing Construction Equipment

Section: Chapter Questions

Problem 6RQ

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Question

A company is considering buying a new piece of machinery. The initial cost of the machine is
80,000 and its salvage value is 20,000 at the end of 20 years. Annual operating cost is 18,000.
What is the equivalent uniform annual cost of the machine based on 10% interest rate?

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