HCT purchased a printing server Al, 7 years ago for $50,000. Unfortunately, this server has broken down and cannot be repaired. The server could be replaced by a new and advanced All costing S60,000 or by a new technology SIl costing $40,000. Management has decided to buy the SIl machine. It has less CPU and computing power than the model All machine, but its specifications are sufficient to support normal services. Management also considered, but rejected, the alternative of stop printing and go digitally. If that were done, the $40,000 invested in the new machine could instead have been invested in a project that would have returned a total of $85,000, In making the decision to buy the SII model rather than the model All server, the differential cost is O $50,000. O $60,000 O $20,000. O $30,000,
HCT purchased a printing server Al, 7 years ago for $50,000. Unfortunately, this server has broken down and cannot be repaired. The server could be replaced by a new and advanced All costing S60,000 or by a new technology SIl costing $40,000. Management has decided to buy the SIl machine. It has less CPU and computing power than the model All machine, but its specifications are sufficient to support normal services. Management also considered, but rejected, the alternative of stop printing and go digitally. If that were done, the $40,000 invested in the new machine could instead have been invested in a project that would have returned a total of $85,000, In making the decision to buy the SII model rather than the model All server, the differential cost is O $50,000. O $60,000 O $20,000. O $30,000,
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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1.
Transcribed Image Text:HCT purchased a printing server Al, 7 years ago for $50,000. Unfortunately, this server has broken down and cannot be repaired. The server could be replaced by a new and
advanced All costing S60,000 or by a new technology SIlI costing $40,000. Management has decided to buy the SII machine. It has less CPU and computing power than the
model All machine, but its specifications are sufficient to support normal services. Management also considered, but rejected, the alternative of stop printing and go digitally.
If that were done, the $40,000 invested in the new machine could instead have been invested in a project that would have returnmed a total of $85,000,
In making the decision to buy the SII model rather than the model All server, the differential cost is
$50,000.
$60,000
$20,000.
$30,000,
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