A truck was purchased 3 years ago for $45,000 and can be sold today for $24,000. The operating costs are $9,000 per year, and it is expected to last 4 more years with a $5,000 salvage value. A new truck, which will perform that same service, can be purchased for $50,000, and it will have a life of 10 years with operating costs of $28,000 per year and a $10,000 salvage value.

What is the value that should be used as P for the presently owned vehicle in a replacement study?

A. $24,000

B. $5,000

C. $50,000

D. $45,000

Answer rating: 100% (QA)

Truck was purchased 3 years ago for 45000 and sol... View the full answer