Annually in maintenance expense

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Your old car costs $3000 annually in maintenance expense. You could replace it with a newer vehicle costing $6000. Both vehicles would be expected to last 4 more years. If your opportunity cost is 10% what should be the maximum annual maintenance expense be on the newer vehicle to justify the purchase? (Hint: EAC on the new vehicle should not exceed $3000)

Reference no: EM13941148

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