You buy a new car for $20 000. Its salvage value declines by declining-balance depreciation of 10% per year, while its maintenance costs are $500 in the first year and go up by $400 a year. If your MARR is 5%, what is the EAC to you of keeping it until it reaches the end of its economic life?
A)$4 358
B)$4 335
C)$4 327
D)$4 333
E)$4 352

Question

Quizplus · Accepted Answer

The Answer of You buy a new car for $20 000. Its salvage value declines by declining-balance depreciation of 10% per year, while its maintenance costs are $500 in the first year and go up by $400 a year. If your MARR is 5%, what is the EAC to you of keeping it until it reaches the end of its economic life?
A)$4 358
B)$4 335
C)$4 327
D)$4 333
E)$4 352

You Buy a New Car for $20 000