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 it the 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 it the 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.
Chapter9: Pricing Construction Equipment
Section: Chapter Questions
Problem 6RQ
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