#1 An equipment cost $80,000 initially. The market value has been declining at the rate of $15,000 yearly. The O & M (Operating & Maintenance) costs in year 1 were $10,000 and have been increasing by $2,000 from year 2. Determine the minimum cost life of this equipment for a MARR of 10%.

(A) 2 years (B) 1 Year (C) 4 Years (D) 5 Years

#2 One of the replacement rule is when the defender's marginal cost becomes greater than the challenger's minimum EUAC (Equivalent Uniform Annual Cost), then replace the defender.

True or Fase ?

...Please show steps!! Thank you!!