You Are Considering Purchase of a New Furnace

question 7

Multiple Choice

You are considering purchase of a new furnace. Its initial cost, including installation, is $3 000, and it will cost $200 a year in fuel over its 10-year life. You expect that it can then be sold for $300. If your MARR is 10%, what is the equivalent annual cost of owning the furnace?

• A)$469
• B)$569
• C)$669
• D)$769
• E)$869

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Definitions:

Characteristics

Distinctive features or qualities that identify and distinguish something or someone.

Desired Outcome

The intended result or goal that an individual, organization, or policy aims to achieve.

Actual Outcome

The real result or end-product of a process, as opposed to the expected or theoretical outcome.

Calories

A measure of energy in food, scientifically defined as the amount of energy needed to raise the temperature of 1 kilogram of water by 1 degree Celsius.