Question

Select the correct answer from the terms provided to complete the sentences below. There are more answers than questions, therefore some of the items will remain unused.

1. Current market value

2. Decreases

3. Sunk costs

4. Alternate

5. Present worth

6. Presently owned

7. Marginal costs

8. Equal service alternatives

9. Economic service life

10. Equivalent annual costs

11. Actual cost estimates

12. Replacement life

13. Disappears

14. Defender

15. Non-profitable

16. All succession options

17. Increases

Match each of the options above to the items below.

• When replacement is conducted, one of the assets under consideration is __________________.

• In a replacement analysis, the presently-owned asset is usually known as the _________________.
• In a replacement analysis, irrelevant past costs are known as ______________.
• In the opportunity cost or conventional approach, the defender's 'first cost' is considered to be its _______________.
• The usage time that will result in an asset's lowest equivalent annual cost is known as the asset's _________________.
• Replacement analysis over a specified study period with several options for the defender's remaining life requires economic comparison of ____________.
• Year-by-year cost estimates of the costs to own and operate an asset are called _________________.
• In an economic service life (ESL) analysis, the capital recovery term _______ with each year of ownership.

Answer 1

1. Presently owned

2. Defender

3. sunk cost

4. present worth

5. Economic service life

6. Equivalent annual cost

7. Actual cost estimates

8. Decreases

1.presently owned because it is the asset which is considered to be replaced and one would replace only those assets whom he/she presently owned

2. It is defender because it is considered to replaced with another option so the another option is known as challenger. It is called defender because the asset has to defend itself by cost analysis if the cost is higher comparatively with new asset then it will be replaced vice -versa.

3. Because it is irrelevant cost

4.present worth because it is the first cost of an asset in 0 year or before the completion of 1 year and the amount which is paid in year 0 is known as present value or worth.

5. Because it values the minimum or lowest value of the usage time

6. To compare several options with the defender equivalent annual cost is required

8 as the ownership of an asset is increasing its capital recovery would decreases because the longer you own a product less will be its useful life and less useful life remaining less capital you would recover

Pls Give a ? if you find it helpful and if you have any query regarding this question pls ask it in the comments section thanks.