Make the acquisition attractive at an interest rate

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Reference no: EM131188163

Enterprise car rental agency has a contract with PM Warranty, Inc. to do major repairs for $850 per car. The car rental agency estimates that it could repair its own cars for $320 each if it acquires a facility for $380000 now. A salvage value of $40000 after 15 years is estimated for the facility. What is the minimum number of cars that must be repaired each year to make the acquisition attractive at an interest rate of 10% per year?

Reference no: EM131188163

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