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Pompei's Pizza has a delivery car that it uses for pizza deliveries. The transmission needs to be repiaced and there are several other repairs that
Pompei's Pizza has a delivery car that it uses for pizza deliveries. The transmission needs to be repiaced and there are several other repairs that need to be done. The car is nearing the end of its life, so the options are to either overhaul the car or replace it with a new car, Pompeil's has put together the following budgetary items: If Pompeil's replaces the transmission of the pizza delivery vehicle, they expect to be able to use the vehicle for another 5 years. If they sell the old vehicle and purchase a new vehicle, they will use that vehicle for 5 years and then trade it in for another new piza delivery vehicle. If they trade for the new delivery vehicle, their operating expenses will decrease because the new vehiele is more gas efficient and the maintenance on a new car is less. This project is analyzed using a discount rate of 15% (Cick here to see present value and future value tables) A. Calculate the NPY on both Cars. Round your present value factor to three decimal places and the rest to nearest dollar
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