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Sarah is an independent programmer for an engineering firm and she needs to determine whether she should upgrade her computer she currently owns or trade
Sarah is an independent programmer for an engineering firm and she needs to determine whether she should upgrade her computer she currently owns or trade her computer in to lease a new one. If she keeps her current computer, she will need to invest in immediate upgrades that cost $500 and it will cost $150 per year to operate at the end of year that follows. She will keep the computer for 4 years; at the end of this period, the upgraded computer will have a salvage value of $400. Alternatively, she could trade in her computer to lease a new one. She estimates that her current computer has a trade-in value of $1,000 and that there will be $450 due at lease signing. She further estimates that it will cost $300 per year to lease and operate the computer. The independent contractor's MARR is 10%. Which Excel entry should you use to to compute the EUAC of the upgrade alternative using the insider perspective? =PMT(10%,4,-500,400)+150 =PMT(10%,4,550)+300 =PMT(4%,10,-500,400)+150 =EUAC(10%,4,150,400)+500
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