Defender:

• Current trade-in (re-sale) value = $7,000, decreasing at an annual rate of 50% from the previous year's value
• O&M = $2,000 in year 1, increasing by $2000 per year
• Immediate overhaul required (if kept) = $500
• Maximum possible lifespan is 5 additional years of service (from now)

Find the AEC at the ESL. Assume MARR = 11%

a) 6648 - 6688

b) None of the other answers

c) 6555 - 6595

d) 6478 - 6518

e) 6805 - 6845

f) 6274 - 6314