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What is the cost associated with this truck that is relevant

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The manager of a small business is considering lowering the price on his main product for the coming year. If there is any increase in the company's current sales, the manager would have to acquire another delivery truck. He can obtain a used truck for $10,000. The market value of this truck would be expected to decline by $2,000 per year. Assume that the manager would earn 6 percent annual interest on the $10,000 if he did not buy the truck. What is the cost associated with this truck that is relevant to this pricing decision?

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This document is prepared in word. This assignment is based on calculating net present value of the cost and revenue. This is original work and there is no plagiarism.

Reference no: EM131387812

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