Question: Problem 8-38 Replacement Decision (LO4) A forklift will last for only 2 more years. It costs $5,000 a year to maintain. For $20,000 you can
Problem 8-38 Replacement Decision (LO4) A forklift will last for only 2 more years. It costs $5,000 a year to maintain. For $20,000 you can buy a new lift that can last for 10 years and should require maintenance costs of only $2,000 a year. a. If the discount rate is 5% per year, should you replace the forklift? (Round your answers to the nearest whole dollar.) b. If the discount rate is 10% per year, should you replace the forklit? (Round your answers to the nearest whole dollar.)
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