Which muffler would you advise to have installed

Reference no: EM132158789

Question: A man had to have the muffler replaced on his 2-year-old car. The repairman offered two alternatives. For $300 he would install a muffler guaranteed for 2 years. But for $400 he would install a muffler guaranteed "for as long as you own the car." Assuming the present owner expects to keep the car for about 3 more years, which muffler would you advise him to have installed if you thought 20% was a suitable interest rate and the less expensive muffler would only last 2 years?

Reference no: EM132158789

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