A fleet owner finds, from his past records, that the cost per year of running a vehicle, whose purchase price is Rs 50,000, is:

Thereafter, the running cost increases by Rs 2,000, but the resale value remains constant at Rs 2,000. At what age is a replacement due?
 

Transcribed Image Text:

Year Running cost (Rs): Resale value (Rs) : 1 2 3 4 5 6 7 5,000 6,000 7,000 9,000 11,500 16,000 18,000 30,000 15,000 7,500 3,750 2,000 2,000 2,000 Year Running cost (Rs): Resale value (Rs) : 1 2 3 4 5 6 7 5,000 6,000 7,000 9,000 11,500 16,000 18,000 30,000 15,000 7,500 3,750 2,000 2,000 2,000

Answer rating: 100% (QA)

1 Calculate Net Cost for Each Year Using the given data we calculate the net cost for each year usin... View the full answer