Problem $8\mathrm{.}34$ Equlvalent Annual Annulty $($LO$5)$

Econo$-$Cool alr conditioners cost $$355$ to purchase, result In electricity bills of $$161$ per year, and last for $5$ years. Luxury Air models

cost $$555,$ result in electriclty bills of $$122$ per year, and last for $8$ years. The discount rate is $20\%.$

a$.$ What is the equlvalent annual cost of the Econo$-$Cool model?

Note: Do not round intermediate calculations. Round your answer to $2$ decimal places.

Answer is complete and correct.

b$.$ What is the equivalent annual cost of the Luxury Air model?

Note: Do not round intermedlate calculations. Round your answer to $2$ decimal places.

Answer is complete and correct.

c$.$ Which model is more cost$-$effective?

Econo$-$Cool

Luxury Air $o.$

d$-1.$ Now you remember that the Inflation rate is expected to be $10\%$ per year for the foreseeable future. What are the equivalent

annual cost of the Econo$-$Cool and Luxury Alr model?

Note: Do not round intermedlate calculations. Round your answers to $2$ decimal places.

Answer is complete but not entirely correct.

d$-2.$ Which model is more costeffectlve$?$

Econo$-$Cool

Luxury Air $o.$