In the assumed baseline, the ICE vehicles would be replaced with new ICE vehicle

Question

In the assumed baseline, the ICE vehicles would be replaced with new ICE vehicles. You will analyze the costs and benefits of purchasing 70 EVs or PHEVs to replace vehicles to be retired. Assume a real discount rate of 4%.

With the GIVEN values calculae the present value of the baseline ICE vehicles - provide equation for each column below the column total

Future Values Year MSRP Fleet Discount Maintenance Costs Gasoline Costs 0 $1,253,000.00 $213,010.00 $41,496.00 $109,060.00 1 0 0 $41,496.00 $109,060.00 2 0 0 $82,992.00 $109,060.00 3 0 0 $110,656.00 $109,060.00 4 0 0 $138,320.00 $109,060.00 5 0 0 $165,984.00 $109,060.00 6 0 0 $165,984.00 $109,060.00 7 0 0 $165,984.00 $109,060.00 Present Values ICE Vehicles Year Discount Factor MSRP Fleet Discount Maintenance Costs Gasoline Costs 0 1 2 3 4 5 6 7 Total

Explanation / Answer

Future Values Year MSRP Fleet Discount Maintenance Costs Gasoline Costs 0         1,253,000             213,010             41,496              109,060 1                    -                       -               41,496              109,060 2                    -                       -               82,992              109,060 3                    -                       -              110,656              109,060 4                    -                       -              138,320              109,060 5                    -                       -              165,984              109,060 6                    -                       -              165,984              109,060 7                    -                       -              165,984              109,060 Present Value Year Discount Factor =1/(1+i)^n MSRP Fleet Discount Maintenance Costs Gasoline Costs 0                   1.000         1,253,000             213,010             41,496              109,060 1                   0.962                    -                       -               39,900              104,865 2                   0.925                    -                       -               76,731              100,832 3                   0.889                    -                       -               98,373                96,954 4                   0.855                    -                       -              118,237                93,225 5                   0.822                    -                       -              136,427                89,639 6                   0.790                    -                       -              131,180                86,192 7                   0.760                    -                       -              126,134                82,877 Total            1,253,000                 213,010                768,477                   763,644 =1/1.04^n , n=no of year =discount factor*Future value =discount factor*Future value =discount factor*Future value =discount factor*Future value

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