8. An asset with a first cost of $20,000 has an annual operating cost of $12,000 and a $4000 salvage value after its 4-year life. If the project will be needed for 6 years, what would the market (salvage) value of the 2-year-old asset have to be for the annual worth to be the same as it is for one life cycle of the asset? Use an interest rate of 10% per year.
8. An asset with a first cost of $20,000 has an annual operating cost of $12,000 and a $4000 salvage value after its 4-year life. If the project will be needed for 6 years, what would the market (salvage) value of the 2-year-old asset have to be for the annual worth to be the same as it is for one life cycle of the asset? Use an interest rate of 10% per year.
Chapter2: Loads On Structures
Section: Chapter Questions
Problem 1P
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![8. An asset with a first cost of $20,000 has an annual operating cost of $12,000
and a $4000 salvage value after its 4-year life. If the project will be needed
for 6 years, what would the market (salvage) value of the 2-year-old asset
have to be for the annual worth to be the same as it is for one life cycle of
the asset? Use an interest rate of 10% per year.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F6ea7355c-0f3a-4d05-a4f1-6c25034f557f%2F8a86040c-6ba1-41df-8ad8-1cf86eaad34d%2Fftutfz_processed.png&w=3840&q=75)
Transcribed Image Text:8. An asset with a first cost of $20,000 has an annual operating cost of $12,000
and a $4000 salvage value after its 4-year life. If the project will be needed
for 6 years, what would the market (salvage) value of the 2-year-old asset
have to be for the annual worth to be the same as it is for one life cycle of
the asset? Use an interest rate of 10% per year.
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