Jenkins Security Has Learned That a Rival Has Offered to Supply

question 62

Multiple Choice

Jenkins Security has learned that a rival has offered to supply a parking garage with security for ten years for $45,000 up front and a further $15,000 per year. If Jenkins Security offers to provide security for eight years for an upfront cost of $60,000 and a separate yearly payment, by what maximum amount can this yearly payment be over $20,000, so that Jenkins' offer matches the equivalent annual annuity of their rival's offer? (Assume a cost of capital of 5%.)

• A) -$89
• B) -$94
• C) -$100
• D) -$111

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Definitions:

Power Screw

A mechanical device used to convert rotary motion into linear motion, commonly used in machinery for lifting, pressing, or clamping actions.

Foundation Brakes

The main components of a vehicle's brake system directly responsible for slowing or stopping the vehicle, including elements like the brake pads, rotors, and drums.

Heavy Truck

A classification of large vehicles used for hauling heavy loads, often exceeding a certain weight threshold and requiring special licensing to operate.

Trailer Service Brakes

Trailer service brakes are the primary braking system on a trailer, designed to be activated by the driver to slow down or stop the trailer during transport.