A Garage Is Comparing the Cost of Buying Two Different

question 105

Multiple Choice

A garage is comparing the cost of buying two different car hoists. Hoist A will cost $20,000, will require servicing of $1000 every two years, and last ten years. Hoist B will cost $15,000, require servicing of $800 per year, and last eight years. If the cost of capital is 7%, which is the better option, given that the firm has an ongoing requirement for a hoist?

• A) Hoist A, since it has a greater present value (PV).
• B) Hoist B, since it has a greater present value (PV).
• C) Hoist A, since it has a greater equivalent annual annuity.
• D) Hoist B, since it has a greater equivalent annual annuity.

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Definitions:

Game Clutter

The excessive proliferation of elements within a video game that can distract or detract from the gaming experience, such as ads, options, or other on-screen information.

Compete

To strive against others to achieve a goal, often relating to sports, business, or market positions.

Players' Attention

The focus or concentration gamers or sports enthusiasts give to a game, often studied in game design and marketing.

Mountain Dew

A carbonated soft drink brand known for its citrus flavor, marketed by PepsiCo.