Solve this finance question on paper. Q) A contractor is considering the following three alternatives:1-Purchase a new bulldozer for $55,000. The bulldozer is expected to last 6 yr with a salvage value of $22,000.2-Lease a new bulldozer for $5,000 per year, payable at the end of each year. The bulldozer should last 6 yr.3-Lease a new bulldozer for $5,000 per year, payable at the beginning of each year. The bulldozer should last 6 yr.If a MARR of 4% is used, which alternative should be selected using a discounted present worth analysis?
Solve this finance question on paper. Q) A contractor is considering the following three alternatives:1-Purchase a new bulldozer for $55,000. The bulldozer is expected to last 6 yr with a salvage value of $22,000.2-Lease a new bulldozer for $5,000 per year, payable at the end of each year. The bulldozer should last 6 yr.3-Lease a new bulldozer for $5,000 per year, payable at the beginning of each year. The bulldozer should last 6 yr.If a MARR of 4% is used, which alternative should be selected using a discounted present worth analysis?
Chapter10: Capital Budgeting: Decision Criteria And Real Option
Section: Chapter Questions
Problem 2P
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Solve this finance question on paper.
Q) A contractor is considering the following three alternatives:1-Purchase a new bulldozer for $55,000. The bulldozer is expected to last 6 yr with a salvage value of $22,000.2-Lease a new bulldozer for $5,000 per year, payable at the end of each year. The bulldozer should last 6 yr.3-Lease a new bulldozer for $5,000 per year, payable at the beginning of each year. The bulldozer should last 6 yr.If a MARR of 4% is used, which alternative should be selected using a discounted present worth analysis?
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