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Your boss has asked you to look into optimizing the van ownership strategy for your company. The company you work for bought a van for $54,600 for making deliveries. You expect the van to be driven 27,300 miles per year, with each mile costing you around $0.63 per mile in the first year. The operating cost per mile is expected to increase by 5% per year after the first year. The resale value of the van is expected to decrease by 20% in the first year and then by 7% per year from there on out. What is the optimal ownership period (economic life) in years assuming a MARR of 9%? 4 years 5 years 7 years 3 years 6 years 2 years 8 years Your boss has asked you to look into optimizing the van ownership strategy for your company. The company you work for bought a van for $54,600 for making deliveries. You expect the van to be driven 27,300 miles per year, with each mile costing you around $0.63 per mile in the first year. The operating cost per mile is expected to increase by 5% per year after the first year. The resale value of the van is expected to decrease by 20% in the first year and then by 7% per year from there on out. What is the optimal ownership period (economic life) in years assuming a MARR of 9%? 4 years 5 years 7 years 3 years 6 years 2 years 8 years
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T A BA1009T CB D ED1009T FC54600E G1AP 009 T HFG End of year OM Costs Present Worth of OM Cost Cumul... View the full answer
Related Book For
Managerial Accounting
ISBN: 978-1259024900
9th canadian edition
Authors: Ray Garrison, Theresa Libby, Alan Webb
Posted Date:
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