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Jerry wants to buy a new delivery truck for his business. The truck will cost $30,000. It is expected to generate net after-tax operating cash

Jerry wants to buy a new delivery truck for his business. The truck will cost $30,000. It is expected to generate net after-tax operating cash flows of $9,750 per year. The MARR is 15%. Given that the truck has a five year expected life and the salvage values for years 1 through 5 are $25,000, $21,000, 17500, 10,000, and $0 respectively, what is its optimal economic life?

a)3 years

b)5 years

c)1 years

d)4 years

e)2 years

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