I’m unsure of any of the answers A truck was purchased four years ago for $65,000 to move raw materials and finished goods between a production facility and fourremote warehouses. This truck (the defender) can be sold at the present time (EOY 0) for $40,000 and replaced by a new truck (thechallenger) with a purchase price of $68,000.EOY(T)1234DefenderAOC$8500105001400018000MV(T)$30,00020,00011,0004,00029,363 dollars/yr.a. What is the absolute value of the TAW for the defender at EOY 2?41,416.20 dollars/yr.EOY(T)1Because of changing demand for the product produced at the facility, the owners of the firm plan to cease operations in 3 years.Given the above cost information and an MARR of 10% APR, answer the following.b. What is the absolute value of the TAW for the challenger at EOY 2?234(If required, answer these questions to the nearest dollar. Use percentages to 3 decimal places. Algebraic signs matter.)ChallengerAOC$5500680074009700MV(T)$56,00044,00034,00022,000 a. What is the absolute value of the TAW for the defender at EOY 2?29,363.2 dollars/yr.b. What is the absolute value of the TAW for the challenger at EOY 2?41,416.20 dollars/yr.c. Given the study period, T is only 3 years, what is the best economic choice for the firm?O Keep the defender for 2 years and replace it with the challenger for 1 yearO Replace the defender in 1 year and replace it with the challenger for 2 yearsO Replace the defender now with the challenger for 3 yearsO Keep the defender for 4 yearsd. What is the basis for the choice in part c?O TAW for the challenger in EOY 3 is $-25,456.O PW for the best possible combination over the study period, T is about $-58,133.O Likely FW of the best combination is greater than 0.O None of these answers are correct.

MARR=10% Defender sold at 0 year=$40000 The initial cost of challenger=68000

A truck was purchased four years ago for $65,000 to move raw materials and finished goods between a production facility and four remote warehouses. This truck (the defender) can be sold at the present time (EOY O) for $40,000 and replaced by a new truck (the challenger) with a purchase price of $68,000.

A truck was purchased four years ago for $65,000 to move raw materials and finished goods between a production facility and four remote warehouses. This truck (the defender) can be sold at the present time (EOY O) for $40,000 and replaced by a new truck (the challenger) with a purchase price of $68,000.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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