Question 8 6 Inco deposits $3000 into a fund earning interest or 675% APR conipo

Question

Question 8

6 Inco deposits $3000 into a fund earning interest or 675% APR conipoi"ded monthly, How much can be withdrawn per quarter if Inco desires a $500 account balance at the end of3 years? (S P) 8240.S b. 8235,32 c $316.35 d. $218,8 e. $225.34 Exco purchases equipment costing $250,000 with a 10 year life and a salvage value of $25,000. It sells the equipment at the end of year 8 for $90,000. If Exco uses straight line depreciation, the before tax gain (loss) is closest to: (S Pts) 7. a. $20,000 b. $45,000 c. $22,500 d. $5,000 $10,000 The economic service life of an asset with the present worth (NPV) and annual worth (AE) values given is: (3 Pts) S. Years n NPV is kept AE if kept n years, $ n years, s 17,000 -18,102 -16,286 -18,188 -19,222 -15,455 45,019 -28,646 -57,655 -72,867 a. 1 year b. 2 years c. 3 years d. 4 years e. 5 years

Explanation / Answer

Question 8:

The economic service life of an asset is the number of years at which the annual worth (AE) of cost of the asset is at a minimum.

From the above table, AE is minimum for n=3; AE = -$16,286

Therefore the economic service life of the asset is 3 years

Therefore correct answer is option c. 3 years

Related Questions

Navigate

• Browse (All)
• Browse Q
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.