A contractor is trying to decide whether to by a new machine now or wait 3 years from now. The machine costs $63,000 if purchased now or $81,000 if purchased 3 years from now. At a real MARR of 12% per year and an inflation rate of 4% per year, determine i he company should buy now or later (a) without any adjustment for inflation and (b) with inflation considered.

A contractor is trying to decide whether to by a new machine now or wait 3 years from now. The machine costs $63,000 if purchased now or $81,000 if purchased 3 years from now. At a real MARR of 12% per year and an inflation rate of 4% per year, determine i he company should buy now or later (a) without any adjustment for inflation and (b) with inflation considered.

Fundamentals Of Construction Estimating

4th Edition

ISBN:9781337399395

Author:Pratt, David J.

Publisher:Pratt, David J.

Chapter18: Life-cycle Costing

Section: Chapter Questions

Problem 14RQ

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