A consulting engineering firm is considering two models of SUVs for the company principals. A GM model will have a first cost of $36,000, an operating cost of $4000, and a salvage value of $15,000 after 3 years. A Ford model will have a first cost of $32,000, an operating cost of $3100, and have a $15,000 resale value, but after 4 years.

1. At an interest rate of 10% per year, which model should the consulting firm buy? Conduct an annual worth analysis.

2. What are the PW values for each vehicle?