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A tractor has a first cost of $40.000 and a salvage value of $15,000 in year 10. The MARR is 12% per year. An identical
A tractor has a first cost of $40.000 and a salvage value of $15,000 in year 10. The MARR is 12% per year. An identical tractor can be rented for $32,000 per year. Annual operating cost is same for both options. If x is the minimum number of years the tractor must be used in order to justify its purchase the relation to find x is represented by: -40.000(A/P, 12%, 10) - 15,000x + 12.000(A/F, 12%, 10) = -32,000x -40.000(A/P, 12%, 10) - 15,000x + 12.000(A/F, 12%, 10) = 32,000x 0 -32.000(A/P, 10%, 12) 12.000x + 15.000(A/F, 10%, 12) = 40,000x -32.000(A/P, 10%, 12) 12,000x + 15.000(A/F, 10%, 12) = -40,000x -40.000(A/P, 12%, 10) + 15,000(AF, 12%, 10) = -32,000x -40.000(A/P, 129, 10)+15,000(A/F. 12%, 10) = 32,000x None of them
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