A company is contemplating replacing its current D9N dozer. An economic analysis

Question

A company is contemplating replacing its current D9N dozer. An economic analysis of the dozer and a proposed replacement is shown below.

4. A company is contemplating replacing its current D9N dozer. An eccnomic analysis of the dozer and a proposed replacement is shown below Old Dozer New Dozer Iotal EUAC 21202 18756 12615 9794 7423 6125 7858 Total EUAG 15205 12820 Yr 8758 11451 Answer the following questions with regard to the economic analysis above a. The economic life cf the Old D9N is b. The economic life cf the new dozer is c. If the assumption oi continuous requirement is used the company snculd chose the years years dozer.(Fill in with old or nev) d. The company did not require a dozer after 3 years, which dozer should the company chose?

Explanation / Answer

a) 7 years b) 7 years c) Old d) New as the cost is more as shown below Year Old New 1 15205 21202 2 12820 18756 3 9895 12615 Total cost 37920 52573

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