$($a$)$

Your answer is partially correct.

Calculate the net present value, ignoring the additional benefits described by Rick. $($If the net present value is negative, use either a negative sign preceding the number e$.$g$.-45$ or parentheses e$.$g$.(45).$ Round answer to $0$ decimal places, e$.$g$.125.$ For calculation purposes, use $5$ decimal places as displayed in the factor table provided.$)$

Net present value

Should the tow truck be purchased?

The tow truck be purchased. Oriole's Auto Care is considering the purchase of a new tow truck. The garage doesn't currently have a tow truck, and the $\backslash (\backslash$$ $60,040\backslash )$ price tag for a new truck would represent a major expenditure. Oriole Austen, owner of the garage, has compiled the following estimates in trying to determine whether the tow truck should be purchased.

Oriole's good friend, Rick Ryan, stopped by$.$ He is trying to convince Oriole that the tow truck will have other benefits that Oriole hasn't even considered. First, he says, cars that need towing need to be fixed. Thus, when Oriole tows them to her facility, her repair revenues will increase. Second, he notes that the tow truck could have a plow mounted on it$,$ thus saving Oriole the cost of plowing her parking lot. $($Rick will give her a used plow blade for free if Oriole will plow Rick's driveway.$)$ Third, he notes that the truck will generate goodwill; people who are rescued by Oriole's tow truck will feel grateful and might be more inclined to use her service station in the future or buy gas there. Fourth, the tow truck will have "Oriole's Auto Care" on its doors, hood, and back tailgate$-$a form of free advertising wherever the tow truck goes. Rick estimates that, at a minimum, these benefits would be worth the following.

The company's cost of capital is $\backslash (9\backslash \%\backslash ).$