Big W Construction purchases a dump truck to use for its upcoming projects. The purchase price delivered is $278,000. Tires for this machine cost $20,000. The company believes it can sell the loader after 7 years (2,500 hr/yr) of service for $62,000. There will be no major overhauls. The company's cost-of-capital is 7.1%. Using the time value method to calculate depreciation and deducting the tire cost from the ownership cost, find the following: Equivalent uniform period series (USCRF) [ Choose ] required to replace the initial ownership cost ($) Equivalent uniform end-of-period investments (USSFF) that equal the future [ Choose ] salvage value ($) Depreciation ($/hr) [ Choose ]

Big W Construction purchases a dump truck to use for its upcoming projects. The purchase price delivered is $278,000. Tires for this machine cost $20,000. The company believes it can sell the loader after 7 years (2,500 hr/yr) of service for $62,000. There will be no major overhauls. The company's cost-of-capital is 7.1%. Using the time value method to calculate depreciation and deducting the tire cost from the ownership cost, find the following: Equivalent uniform period series (USCRF) [ Choose ] required to replace the initial ownership cost ($) Equivalent uniform end-of-period investments (USSFF) that equal the future [ Choose ] salvage value ($) Depreciation ($/hr) [ Choose ]

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Ali needs to work on a project in Australia for 5 years and he needs a car. He has the choice between buying one and leasing one. After some research, he finds out the following: If he decides to buy the car, it would cost him 300,000 AED and after five years, he could sell it for 30A AED. If he decides to lease the car, he would have to pay 50,000 AED per year. Assuming an MARR of S perform an evaluation and decide if he should lease or buy the car.
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