What is the present value of buying car 2 (gas vehicle)? What is the present value of buying car 2 (hybrid vehicle)?

cost of car 2= 24050

cost of car 1= 23100

Life of both cars are 10 years.

no residual value.

Computation of Present Value of Fuel Cost of Car 1 Average Fuel Cost for Car 1= $849 per year Discounting Factor@6% = 0.943 Thus, Present Value of fuel cost = $800.607 (849*0.943) Computation of Present Value of Fuel Cost of Car 2 Average Fuel Cost for Car 2 = $1551 per year Discounting Factor @6% = 0.943 Thus, Present Value of fuel cost = $1462.59 ( 1551*0.943)