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Sara has graduated from HS and her parents have given her a car fund of $21,000 to help purchase and maintain a 3 year old

Sara has graduated from HS and her parents have given her a car fund of $21,000 to help purchase and maintain a 3 year old car in college. Because of maintenance costs, her parents tell her that she may trade in her car for another 3 year old car (at a cost of $12000), one or more times during the next 3 summers if she determines that it will minimizer her overall costs. They also tell her that in 4 years they will buy her a new car as a college graduation present so she should definitely plan on trading in the car then. Yearly operational and maintenance cost are provided below.

Operation and Maintenance Costs of ownership year

Trade in Values at End

of Ownership Year
Car Purchase Price12341234
$12,000$200$300$4500$6500$8500$6500$4500$300

Formulate the problem as a minimum flow network problem and then solve it using excel.

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