Finch,Inchas Bought a New Server and Must Decide What to Do

question 68

Essay

Finch,Inc.has bought a new server and must decide what to do with the old one.The cost of the old server was originally $60,000 and has been depreciated $45,000.The company has received two offers.One offer was made to purchase the equipment outright for $18,500 less a 5% sales commission.The other offer was to lease the equipment for $7,000 for the next five years but the company will be required to provide maintenance and insurance totaling $3,000 per year.What offer should Finch,Inc.accept?

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Definitions:

Delay

The act of postponing or causing something to occur at a later time than originally planned or expected.

Negative Reinforcement

A process in operant conditioning where a response is strengthened by stopping, removing, or avoiding a negative outcome or aversive stimulus.

Primary Reinforcement

An activity whose reinforcing properties are innate.

Positive Reinforcement

An event whose occurrence increases the frequency of the behavior that precedes it.