Leroy purchased an Al-based robotics system with the first cost of $345,000, an AOC of $148,000 per year, a $140,000 salvage value, and an ESL of 3 years. Rather than trading after 3 years, he kept the system for a total of 5 years. Due to the wear factor and expense of repairs, its AOC Increased to $500,000 per year starting in year 4, plus the salvage value went to zero. At / = 10% per year, what is the percentage Increase in the AW of costs that Leroy experienced? The percentage increase in the AW of costs that Leray experienced is %.
Leroy purchased an Al-based robotics system with the first cost of $345,000, an AOC of $148,000 per year, a $140,000 salvage value, and an ESL of 3 years. Rather than trading after 3 years, he kept the system for a total of 5 years. Due to the wear factor and expense of repairs, its AOC Increased to $500,000 per year starting in year 4, plus the salvage value went to zero. At / = 10% per year, what is the percentage Increase in the AW of costs that Leroy experienced? The percentage increase in the AW of costs that Leray experienced is %.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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![Leroy purchased an Al-based robotics system with the first cost of $345,000, an AOC of $148,000 per year, a $140,000 salvage value,
and an ESL of 3 years. Rather than trading after 3 years, he kept the system for a total of 5 years. Due to the wear factor and expense
of repairs, its AOC Increased to $500,000 per year starting in year 4, plus the salvage value went to zero. At /= 10% per year, what is
the percentage Increase in the AW of costs that Leroy experienced?
The percentage increase in the AW of costs that Leroy experienced isO%.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F627efc1e-6dd5-490e-992b-10ac9c65fb29%2F77c3a5f2-017f-4e38-97a9-a66f6397409e%2Fnkqtn2n_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Leroy purchased an Al-based robotics system with the first cost of $345,000, an AOC of $148,000 per year, a $140,000 salvage value,
and an ESL of 3 years. Rather than trading after 3 years, he kept the system for a total of 5 years. Due to the wear factor and expense
of repairs, its AOC Increased to $500,000 per year starting in year 4, plus the salvage value went to zero. At /= 10% per year, what is
the percentage Increase in the AW of costs that Leroy experienced?
The percentage increase in the AW of costs that Leroy experienced isO%.
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