The table below contains the calculated annual equivalent cost for a defender and a challenger based on the market value and the maintenance cost: Defender ΕΟΥ AEC Challenger AEC 0 $21,114 $25,557 1 $20,019 $24,210 2 $16,560 $23,110 3 $18,538 $20,348 4 $21,993 $18,085 5 $22,617 $25,971 6 $23,174 $26,533 7 $25,331 $28,758 Which of the following statements are true? Select all that apply. The defender should not be replaced now. The defender should be replaced now. The economic life of the challenger is 4 years. The annual equivalent cost of the defender is greater than the annual equivalent cost of the challenger. The economic life of the defender is 4 years. The economic life of the defender is 2 years The annual equivalent cost of the challenger is greater than the annual equivalent cost of the defender. The economic life of the challenger is 7 years.

The table below contains the calculated annual equivalent cost for a defender and a challenger based on the market value and the maintenance cost: Defender ΕΟΥ AEC Challenger AEC 0 $21,114 $25,557 1 $20,019 $24,210 2 $16,560 $23,110 3 $18,538 $20,348 4 $21,993 $18,085 5 $22,617 $25,971 6 $23,174 $26,533 7 $25,331 $28,758 Which of the following statements are true? Select all that apply. The defender should not be replaced now. The defender should be replaced now. The economic life of the challenger is 4 years. The annual equivalent cost of the defender is greater than the annual equivalent cost of the challenger. The economic life of the defender is 4 years. The economic life of the defender is 2 years The annual equivalent cost of the challenger is greater than the annual equivalent cost of the defender. The economic life of the challenger is 7 years.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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