(adsbygoogle = window.adsbygoogle || []).push({}); 1. The problem statement, all variables and given/known data

A Machine at a cost of $5,000 was purchased 3 years ago. It can be sold now for $3,000. If the machine is kept, the annual operating and maintenance costs will be $1,500. If it is kept and operated for next five years, determine the amount at time 0 (now) equivalent to the cost of owning and operating the machine can be sold for $1,000 at the end of the five year period. Use an interest rate of 10%.

A. 8065

B. 6550

C. 9522

D. 5002

2. Relevant equations

Not exactly sure which to use but here are the ones from the chapter we are studying:

F = P(1 + i)^n

F = A [((1 + i)^n - 1))/i]

P = A [((1 + i)^n - 1))/((i(1 + i)^n))]

3. The attempt at a solution

1500 * 5 = 7500

7500 - 1000 = 6500

6500 is not one of the choices

What now?

1. The problem statement, all variables and given/known data

2. Relevant equations

3. The attempt at a solution

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# Homework Help: Economics and uniform series formula problems

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