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Lyft is trying to decide on a supplier for an autonomous vehicle for its ride-hailing service. The choise is between a Tesla, a VW and

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Lyft is trying to decide on a supplier for an autonomous vehicle for its ride-hailing service. The choise is between a Tesla, a VW and a Lucid. The VW is the least expensive of the three and has an initial cost of $75,000 and a five-year expected life. The project will require an investment in working capital of $10,000. The VW is expeced to generate $65,000 per year in revenue, but have expenses of $28,000. The VW will be depreciated straight-line to a zero salvage value over 5 years, but it is expected to actually be sold for $15,000 at that time. Lyft's tax rate is 25% and the project's required rate of return is 15%. What is the EAA/EAC of the VW? $764.93 $9.294.88 -$1.255.83 $7.961.55

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