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Hillsdale Is Considering Two Options for Comparable Computer Software

question 46

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Hillsdale is considering two options for comparable computer software.Option A will cost $25,000 plus annual license renewals of $1,000 for three years,which includes technical support.Option B will cost $20,000 with technical support being an add-on charge.The estimated cost of technical support is $4,000 the first year,$3,000 the second year,and $2,000 the third year.Assume the software is purchased and paid for at the beginning of year one,but that technical support is paid for at the end of each year.The discount rate is 8%.Ignore income taxes.Determine which option should be chosen based on present value considerations.


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Social Interaction

The communication or direct involvement between individuals or groups.

Ascribed Status

A status that does not depend on the capabilities and efforts of the individual.

Competition For Attention

The rivalry among businesses or individuals to capture and maintain the interest of an audience or market.

Charles Derber

A contemporary American sociologist known for his research and writings on social movements, corporate power, and environmental issues.

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