Consider the following two tractors a company can purchase. The following tables provide the costs the company will incur (in thousands of dollars) in the lifetime of each tractor.

	Initial Cost	Operating Costs per Year	Expected Life
Diesel	$18,000	$13,000	7
Gasoline	$7,000	$10,000	5

The transportation firm can only afford one of the tractors. The two tractors have identical production capabilities. The firm's cost of capital is 2%.

Find the present value of the costs of using the two tractors.

Diesel =

Gasoline =

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