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A farmer is considering two different tractors for his business. Each tractor has a different price but also a different life span. The farmer will
A farmer is considering two different tractors for his business. Each tractor has a different price but also a different life span. The farmer will have to replace either tractor at the end of its useful life and start again. We will assume that the farmer has a discount rate of 9.00%. MODEL A: Initial cost of $14,421.00, Yearly operating cost of $911.00 for 8.00 years. MODEL B: Initial cost of $12,700.00, Yearly operating cost of $1,507.00 for 10.00 years.
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