Service contract for maintenance on equipment will cost

Assignment Help Business Economics

Reference no: EM131112352

A land development company is considering the purchase of earth-moving equipment. The equipment will have a first cost of $190,000 and a salvage value of $70000 when he company sells it in 10 years. A service contract for maintenance on the equipment will cost $40000 per year. The operating cost is expected to be $260 per day. Alternatively, the company can rent the necessary equipment for $1100 per day and hire a driver at $180 per day. If the company's MARR is 10% per year, how many days per year must the company need the equipment in order to justify its purchase?

Reference no: EM131112352

Questions Cloud

Demand curve would best represent monopolistic competitor : Which demand curve would best represent a monopolistic competitor? If demand curve D2 represents a monopolistic competitor and demand curve D1 represents a perfect competitor, then. If demand curve D2 represents a monopolistic competitor and demand ..

Suppose the amount of exports of textile machinery : Suppose the amount of exports of textile machinery from Italy to the rest of the world equals 60 billion tons. The amount of imports of textile machinery into Italy from the rest of the world is 40 billion tons. Therefore, the intra industry trade sh..

Confidence falls as result of bursting housing market : Suppose consumer confidence falls as a result of a bursting housing market. How is this factor change likely to affect the IS and/or the LM curve? In response to this factor change, describe optimal fiscal policy.

What does the is curve represent : Develop the IS curve using the Keynesian Cross diagram in tandem with investment demand. How does an increase in government spending affect the position of the IS curve? How does an increase in the real interest rate affect the position of the IS cur..

Service contract for maintenance on equipment will cost : A land development company is considering the purchase of earth-moving equipment. The equipment will have a first cost of $190,000 and a salvage value of $70000 when he company sells it in 10 years. A service contract for maintenance on the equipment..

The supply of labor curve for nurses shifts : Entrepreneurship differs from the other factors of production because it. A natural resource is renewable if it. The supply of labor curve for nurses shifts if

About impact of money and fiscal policy in that special case : Determine whether each of the following statements in true or false, and explain why. For each true statement, discuss whether there is anything unusual about the impact of money and fiscal policy in that special case.

The value of marginal product of labor curve : The value of marginal product of labor curve. As the price of land rises, the quantity supplied. The value to a firm of hiring another worker is the worker's value of marginal product. The value of marginal product equals the price of the good produc..

What is the effective rate of protection for the domestic : What is the effective rate of protection for the domestic MP3 player industry following the imposition of a 20 percent tariff on the imports of MP3 players. The cost of material inputs used in production of MP3 players in the country is $100 per unit..

User Account

All Pages