Hed to make the challenger a better economic choice now. ens based on interest factors with 5 decimal places. ife, (years) ket value, (S) year) ge, (S) ystem, ($ per year) 00 70 per year to determine the minimum resale price 13 Current System 5 50,000 -100,000 0 New System -195,000
Hed to make the challenger a better economic choice now. ens based on interest factors with 5 decimal places. ife, (years) ket value, (S) year) ge, (S) ystem, ($ per year) 00 70 per year to determine the minimum resale price 13 Current System 5 50,000 -100,000 0 New System -195,000
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
5
![Two systems are under consideration. The relevant costs for each system are known or estimated
(see table below). Use an interest rate of 14% per year to determine the minimum resale price
(RV) needed to make the challenger a better economic choice now.
Calculations based on interest factors with 5 decimal places.
Remaining life, (years)
Current market value, (S)
AOC, ($ per year)
Future salvage, (S)
AW New System, ($ per year)
a) $195,000
b) $326,143
c) $50,000
d) $150,000
Current
System
5
50,000
-100,000
0
New
System
-195,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3ff6e6fd-adc9-4093-b759-2557b1c5934b%2F1e4fdda2-6de3-4790-8583-89024c244cdf%2F2kjk35q_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Two systems are under consideration. The relevant costs for each system are known or estimated
(see table below). Use an interest rate of 14% per year to determine the minimum resale price
(RV) needed to make the challenger a better economic choice now.
Calculations based on interest factors with 5 decimal places.
Remaining life, (years)
Current market value, (S)
AOC, ($ per year)
Future salvage, (S)
AW New System, ($ per year)
a) $195,000
b) $326,143
c) $50,000
d) $150,000
Current
System
5
50,000
-100,000
0
New
System
-195,000
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