4. 5.15 Your friend is considering a new exhaust system for his Lamborghini Diablo. The estimates from two shops are shown below.

Besides installation, shop Y includes a full replacement warranty for 4 years in the quote. Since money does not appear to be a problem for your friend, and he asked you about the economics of the two quotes, which should he choose based on annual worth values and an interest rate of 12% per year?

Table Summary: A table divided into three columns summarizes estimates from two shops. The column headers are marked from left to right as:

Shop; X; and Y.

Shop X Y Installed cost, $ −1765 −2900 Total AOC, $/year −1200 −900 Salvage value, $ 0 800 Life, years 2 4