Kris Kringle Corp. needs to purchase a new delivery vehicle. The Sleigh 9000 model's purchase price is $90,000, will last for 20 years, and requires maintenance costs of $5,000 per year for the first 10 years (years 1-10) and $8,000 per year for the last 10 years (years 11-20). What is the equivalent annual cost (EAC) of this equipment at a discount rate of 12.25%? $6.602 $17957 $13991 $11,000 $6,890

Elijah Enterprises will need to upgrade the computer system in 4 years. They anticipate the upgrade to cost $105,300. If the discount rate is 13%, what will be the required yearly investment needed to obtain the money for the upgrade?Round your (1+R)^n value to 2 decimal places and use that number for your final amount required rounded to the nearest dollar. Future Value / (1+R)^n = Amount Required   /   =   What would be required if the discount rate was 8%? Future Value / (1+R)^n = Amount Required   /   =

Deutsche Transport can lease a truck for four years at a cost of €38,000 annually. It can instead buy a truck at a cost of €88,000, with annual maintenance expenses of €18,000. The truck will be sold at the end of four years for €24,500. Ignore taxes. a. What is the equivalent annual cost of buying and maintaining the truck if the discount rate is 12%? Note: Do not round intermediate calculations. Enter your answer in euros. Round your answer to the nearest whole number. b. Which is the better option: leasing or buying? a. Equivalent annual cost b. Better option

Elijah Enterprises will need to upgrade the computer system in 5 years. They anticipate the upgrade to cost $98,900. If the discount rate is 15%, what will be the required yearly investment needed to obtain the money for the upgrade?Round your (1+R)^n value to 2 decimal places and use that number for your final amount required rounded to the nearest dollar.

Kamil Koç Transportation is considering two models of buses for newly opened routes. Bus Model 1 will have a first cost of $160912, an operating cost of $21338 per year, and a resale value of $86231 after 6 years. Bus Model 2 will have a first cost of $108347, an operating cost of $15486 per year, and also have a $75850 resale value, but after 4 years. At an interest rate of 7% per year, which model should the Kamil Koç buy based on an annual worth analysis? What is the annual worth and the present worth of the selected alternative? Select one: a. Bus Model 1 is selected, AW is $-25017 and PW is $-102936 b. Bus Model 2 is selected, AW is $-30390 and PW is $– 30390 c. Bus Model 1 is selected, AW is $-25017 and PW is $-205161 d. Bus Model 2 is selected, AW is $-33123 and PW is $ – 102936 e. Bus Model 2 is selected, AW is $-33123 and PW is $-205161 f. Bus Model 1 is selected, AW is $-30390 and PW is $-102936

Sauer Food Company has decided to buy a new computer system with an expected life of three years. The cost is $290,000. The company can borrow $290,000 for three years at 11 percent annual interest or for one year at 9 percent annual interest. Assume interest is paid in full at the end of each year. a. How much would Sauer Food Company save in interest over the three-year life of the computer system if the one-year loan is utilized and the loan is rolled over (reborrowed) each year at the same 9 percent rate? Compare this to the 11 percent three-year loan. 9 percent loan 11 percent loan Interest savings Interest b. What if interest rates on the 9 percent loan go up to 14 percent in year 2 and 17 percent in year 3? What would be the total interest cost compared to the 11 percent, three-year loan? Fixed-rate 11% loan Variable-rate loan Additional interest cost Interest

A firm can lease a truck for 4 years at a cost of $35,000 annually. It can instead buy a truck at a cost of $85,000, with annual maintenance expenses of $15,000. The truck will be sold at the end of 4 years for $25,000. a. What is the equivalent annual cost of buying and maintaining the truck if the discount rate is 12%? Note: Do not round intermediate calculations. Round your answer to 2 decimal places. Equivalent annual cost b. Which is the better option? Lease O Buy

Green Power Company is considering acquiring a new machine that will last 14 years and it can be purchased right now for 116,319 dollars; maintenance will cost 23,444 dollars the first year, increasing by 6,434 dollars per year thereafter (e.g. maintenance at the end of year two is equal to 23,444 plus 6,434 dollars). If the interest rate is 7% per year, compounded annually, how much money should the company set aside now to purchase and provide for the future maintenance of this machine (NPV)? (note: round your answer to the nearest cent and do not include spaces, currency signs, or commas)

Fabco, Inc., is considering purchasing flow valves that will reduce annual operating costs by $10,000 per year for the next 12 years. Fabco’s MARR is 7%/year. Using an internal rate of return approach, determine the maximum amount Fabco should be willing to pay for the valves. $

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