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Business, 01.04.2021 18:00 TheJanko4526

g An independent contractor for a transportation company needs to determine whether she should upgrade the vehicle she currently owns or trade her vehicle in to lease a new vehicle. If she keeps her vehicle, she will need to invest in immediate upgrades that cost $5,100 and it will cost $1,650 per year to operate at the end of year that follows. She will keep the vehicle for 4 years; at the end of this period, the upgraded vehicle will have a salvage value of $4,000. Alternatively, she could trade in her vehicle to lease a new vehicle. She estimates that her current vehicle has a trade-in value of $10,000 and that there will be $4,700 due at lease signing. She further estimates that it will cost $3,200 per year to lease and operate the vehicle. The independent contractor's MARR is 10%. Compute the EUAC of both the upgrade and lease alternatives using the insider perspective.

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