Question
Khaled's 5-year-old BMW requires repairs estimated at $3,000 to make it roadworthy again. His friend, Ahmad, suggested that he should buy a 5-year-old used Honda
Khaled's 5-year-old BMW requires repairs estimated at $3,000 to make it roadworthy again. His friend, Ahmad, suggested that he should buy a 5-year-old used Honda Civic instead for $5,000 cash. Ahmad estimated the following costs for the two cars:
BMW Honda Civic
Acquisition cost $15,000 $5,000
Repairs $ 3,000
Annual operating costs
(Gas, maintenance, insurance) $ 2,280 $2,100
The cost NOT relevant for this decision is the:
[[selectone]]
a. repairs to the BMW
b. acquisition cost of the BMW
c. annual operating costs of the Honda Civic
d. the acquisition cost of the Honda Civic
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