A small manufacturing company is evaluating trucks for delivering their products. Truck A has a first cost of $32,000. Its operating cost will be $5500 per year, and its residual value after 3 years will be $7000. Truck B hyas a first cost of $37,000, an operating cost of $5200 per year, and a resale value of $12,000 after 4 years. At an interest rate of 12%, which truck should be chosen?

A small manufacturing company is evaluating trucks for delivering their products. Truck A has a first cost of $32,000. Its operating cost will be $5500 per year, and its residual value after 3 years will be $7000. Truck B hyas a first cost of $37,000, an operating cost of $5200 per year, and a resale value of $12,000 after 4 years. At an interest rate of 12%, which truck should be chosen?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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