You own a machine that has fulfilled its economic life and its market value is 0. It has a fixed operating cost of $35,000 and a changing (variable) maintenance cost. You conduct a replacement...


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You own a machine that has fulfilled its economic life and its market value is 0. It has a fixed operating cost of $35,000 and a changing<br>(variable) maintenance cost. You conduct a replacement analysis with a challenger that has a buy price of $80,000 and the following<br>market value and cost information:<br>Year<br>1<br>2<br>3.<br>O&M<br>expense $30,000 $30,000 $35,000 $40,000 $45,000<br>Market<br>value<br>60,000 50,000 40,000 25,000 12,500<br>With a MARR 15% your replacement analysis has shown that you should replace the defender immediately. What is the minimum value<br>of the changing (variable) maintenance cost?<br>If your answer is $5,000 write it as 5000. Do not use $ symbol or thousand separator.<br>

Extracted text: You own a machine that has fulfilled its economic life and its market value is 0. It has a fixed operating cost of $35,000 and a changing (variable) maintenance cost. You conduct a replacement analysis with a challenger that has a buy price of $80,000 and the following market value and cost information: Year 1 2 3. O&M expense $30,000 $30,000 $35,000 $40,000 $45,000 Market value 60,000 50,000 40,000 25,000 12,500 With a MARR 15% your replacement analysis has shown that you should replace the defender immediately. What is the minimum value of the changing (variable) maintenance cost? If your answer is $5,000 write it as 5000. Do not use $ symbol or thousand separator.

Jun 10, 2022
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