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1.Tenyearsago,JacobsonRecoverypurchasedawreckerfor$285,000tomove disabled18-wheelers.Heanticipatedasalvagevalueof$50,000after10years. Duringthistimehisaverageannualrevenuetotaled$52,000.(a)Didherecoverhis investmentanda12%peryearreturn?(b)IftheannualM&Ocostwas$10,000the firstyearandincreasedbyaconstant$1,000peryear,wastheAWpositiveor negativeat12%peryear?Assumethe$50,000salvagewasrealized.

1.Tenyearsago,JacobsonRecoverypurchasedawreckerfor$285,000tomove disabled18-wheelers.Heanticipatedasalvagevalueof$50,000after10years. Duringthistimehisaverageannualrevenuetotaled$52,000.(a)Didherecoverhis investmentanda12%peryearreturn?(b)IftheannualM&Ocostwas$10,000the firstyearandincreasedbyaconstant$1,000peryear,wastheAWpositiveor negativeat12%peryear?Assumethe$50,000salvagewasrealized.

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