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Solve on Excel for PMT and determine based on cost calculated which pump should be selected.

Solve on Excel for PMT and determine based on cost calculated which pump should be selected.

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Two pumps are being considered for purchase. If interest is 7%, which pump should be bought? Consider salvage value as a cost since it is part of the capital recovery cost. Pump A Pump B Initial Cost $8,000 $6,000 End of useful life, salvage value $1600 $1000 Useful life, in years 12 12 Solve on Excel for PMT and determine based on cost calculated which pump should be selected.
Transcribed Image Text:Two pumps are being considered for purchase. If interest is 7%, which pump should be bought? Consider salvage value as a cost since it is part of the capital recovery cost. Pump A Pump B Initial Cost $8,000 $6,000 End of useful life, salvage value $1600 $1000 Useful life, in years 12 12 Solve on Excel for PMT and determine based on cost calculated which pump should be selected.
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