Question

You are considering purchasing a dump truck. the truck will cost $45,000 and have operating and maintenance costs that start at $15,000 the first year and increase by $2,000 per year thereafter. assume that the salvage value at the end of 5 years is $9,000 and interest rate is 12%. determine the equivalent annual cost of owning and operating the truck.

Answer 1

The operating cost is 31000

I hope this will help you