Fight Finance

Courses  Tags  Random  All  Recent  Scores

Scores
keithphw$6,011.61
Jade$1,815.80
Chu$789.98
royal ne...$750.00
Leehy$713.33
Visitor$650.00
JennyLI$625.61
Visitor$590.00
ZOE HY$560.00
Visitor$555.33
Visitor$550.00
Visitor$550.00
Visitor$540.00
Visitor$500.00
Yizhou$489.18
Visitor$480.00
Visitor$464.70
Visitor$460.00
Jasper.sun$460.00
Visitor$460.00
 

Question 505  equivalent annual cash flow

A low-quality second-hand car can be bought now for $1,000 and will last for 1 year before it will be scrapped for nothing.

A high-quality second-hand car can be bought now for $4,900 and it will last for 5 years before it will be scrapped for nothing.

What is the equivalent annual cost of each car? Assume a discount rate of 10% pa, given as an effective annual rate.

The answer choices are given as the equivalent annual cost of the low-quality car and then the high quality car.




Copyright © 2014 Keith Woodward