Question

In: Civil Engineering

You are considering buying a vehicle to use in your daily errands. A used vehicle will...

You are considering buying a vehicle to use in your daily errands. A used vehicle will cost EGP85,000 and have a EGP20,000 market (salvage) value after a 5 years useful life, and consumes 2 liters of fuel per 10 km travelled. A new vehicle will cost EGP130,000 and have a EGP40,000 market value after a 6 years useful life. The new vehicle is expected to reduce fuel consumption compared with the used vehicle. You expect to drive the vehicle 18,000 km per year. Fuel costs EGP8/liter and the interest rate is 15% per year.

a) If the new vehicle is expected to reduce fuel consumption by 10% compared with

the used vehicle, which vehicle should you buy?

b) What is the percent reduction in the fuel consumption by the new vehicle that

would reverse the decision you made in part (a)?

c) Determine the percentage change in the salvage value of the new vehicle that

would reverse the decision made in part(a)?

Solutions

Expert Solution

Ally Wells answered 9 months ago
Next > < Previous

Related Solutions

How will you use the Code of Ethics in your daily practice?
How will you use the Code of Ethics in your daily practice?
How about the use of technology in your daily life? Can you compare the use of...
How about the use of technology in your daily life? Can you compare the use of existing technology with the latest technology that you know? Discuss the advantages and disadvantages. Give your suggestions on how to improve the use of technology. Please I need it as an essay bcuz it's an assignment which has 25%
You are considering buying a new​ car, because you think it will save you money. Your...
You are considering buying a new​ car, because you think it will save you money. Your think your old car will cost​ $2,200 in gas and maintenance next year​ (Year 1), and you expect that to increase by​ 6% every year until the end of Year 10. A new car will cost you​ $16,500 now​ (Year 0). You think it will cost​ $500 in gas and maintenance next year​ (Year 1), and you expect that to increase by​ 4% every...
How would you use confidence intervals in your daily life?
How would you use confidence intervals in your daily life?
You are considering buying a store. In order to better access your return on the investment,...
You are considering buying a store. In order to better access your return on the investment, you must ask the storeowner for the figures on days when a. ​Sales are high, costs are low b. ​Sales are low, costs are high c. ​Both sales and costs are high d. ​All of the above QUESTION 2 ​ At a carnival roulette wheel, a player can either win $10, $30, or $80. At what cost of play should the player expect the...
You work as a financial analyst for RBC. Your company is considering buying an airplane and...
You work as a financial analyst for RBC. Your company is considering buying an airplane and then lease it to Delta Air Lines. Your task is to determine the before tax leasing payment You may choose an airplane of your choice (747, 767, 777, 787) Assume 20 year depreciation period in your lease analysis. Make your assumptions about tax rate, required rate of return,plane cost, salvage value, etc. Try to show your work and formulas used.
You work as a financial analyst for RBC. Your company is considering buying an airplane and...
You work as a financial analyst for RBC. Your company is considering buying an airplane and then lease it to Delta Air Lines. Your task is to determine the before tax leasing payment You may choose an airplane of your choice (747, 767, 777, 787) Assume 20 year depreciation period in your lease analysis. Make your assumptions about tax rate, required rate of return,plane cost, salvage value, etc. Try to show your work and formulas used.
You are thinking of buying a used car for $4,000 for driving to school. Your parents...
You are thinking of buying a used car for $4,000 for driving to school. Your parents are willing to lend you the $4,000 and charge only 2.4% APR. They want the loan repaid equally in 48 monthly payments, with the first payment due at the end of the month in which you buy the car. You estimate that the monthly cost of operating the car, including gas, insurance, maintenance and licence fees will be $200 and payable at the start...
Your company is considering buying back some of its stock. You are assigned the task of...
Your company is considering buying back some of its stock. You are assigned the task of correctly assessing the value of the company so that the company can make a rational decision. Select 4 ratios that you believe would provide the best insight into the condition of the company and provide a rationale as to why you feel that they would be most relevant. Current Ratio                                                     =                                                  Current assets/current liabilities Acid-test Ratio    =                             Cash+accounts recieveable/current liabilities Return on equity...
Existing Online DSS system for buying a vehicle. Methodology/Approach/ Design for buying vehicles.
Existing Online DSS system for buying a vehicle. Methodology/Approach/ Design for buying vehicles.
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT