Two systems are under consideration. The relevant costs for each system are known or estimated (see table below). Use an interest rate of 12% per year to determine the minimum resale price (RV) needed to make the challenger a better economic choice now.

Calculations based on interest factors with 5 decimal places.

	RV= $342,453
	RV= $400,168
	RV= $382,060
	RV= $522,692

Remaining life, years) Current market value, $0 AOC, per year) Future salvage, AWNew system, (S per year) Current System 50,000 100,000 New System 195,000 Remaining life, years) Current market value, $0 AOC, per year) Future salvage, AWNew system, (S per year) Current System 50,000 100,000 New System 195,000