Natasha Gurdin is debating which of two possible models of a car to buy (A or B),

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Natasha Gurdin is debating which of two possible models of a car to buy (A or B), being indifferent with regard to their technical performance. She has been told that the average monthly cost of owning model A, based on an LCC analysis, is $500.

a. Using the following data for model B, calculate its LCC and determine which model is the better choice for Natasha:

Purchase price Life expectancy Resale value Maintenance Operational cost (gas, etc.) Car insurance Mean time

b. Develop a general model that can be used to calculate the LCC for a car.

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Project Management Processes Methodologies And Economics

ISBN: 9780130413314

2nd Edition

Authors: Avraham Shtub, Jonathan F. Bard, Shlomo Globerson

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Question Posted: Jan 17, 2024 08:00 AM

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Natasha Gurdin is debating which of two possible models of a car to buy (A or B),

Question:

Purchase price Life expectancy Resale value Maintenance Operational cost (gas, etc.) Car insurance Mean time between failures Repair lost per failure $23,000 4 years $13,000 $1,100 per year $90 per month $1,400 per year 14 months $650

Step by Step Answer:

a Calculating LCC and Choosing the Best Model for Natasha Model B LCC Calculation Year 1 Purchase price 23000 Maintenance 1100 Operational cost 90mont...View the full answer

Project Management Processes Methodologies And Economics

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