Tom is considering purchasing a 24,000 car.After five years, he will be able to sell the vehicle for 7,500.Petrol costs will be 1,900 per year, insurance 700 per year, and parking 700 per year.Maintenance costs will be 900, rising by 400 per year thereafter.

The alternative is for Tom to take taxis everywhere.This will cost an estimated 7,000 per year.Tom will rent a vehicle each year at a total cost (to year-end) of 700 for the family vacation, if he has no car.If Tom values money at 10% annual interest, should he buy the car?Use an annual worth comparison method {Perform all calculations using 5 significant figures and round any monetary answers to the nearest cent}.

The annual cost of operating an Auto is?

The annual cost of using taxis as an alternative is?

Which option should Tom take (enter either 'Auto' or 'Taxi'?