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Practice Questions
Test your understanding with targeted questions related to the topic.
Question 1
Easy
What does EAC stand for?
💡 Hint: The acronym you use when discussing annual costs.
Question 2
Easy
Name the two types of equipment discussed.
💡 Hint: One is what you currently have.
Practice 4 more questions and get performance evaluation
Interactive Quizzes
Engage in quick quizzes to reinforce what you've learned and check your comprehension.
Question 1
What does EAC stand for?
- Estimated Average Cost
- Equivalent Annual Cost
- Expected Annual Cost
💡 Hint: Think about annual costs related to equipment.
Question 2
True or False: Sunk costs should be considered in replacement analysis.
- True
- False
💡 Hint: Remember what has already been spent.
Solve and get performance evaluation
Challenge Problems
Push your limits with challenges.
Question 1
Consider an equipment with an initial cost of 30,00,000 and a salvage value of 10,00,000 after 5 years with a 10% interest rate. Discuss the equivalency of costs if operating costs are projected at 2,00,000 per year.
💡 Hint: Understand the impact of costs on long-term ownership.
Question 2
Given the following information, analyze which equipment to retain: Defender EAC is 650,000, Challenger EAC is 610,000, but Challenger has higher initial repair costs. Discuss implications.
💡 Hint: Consider both short term and long term costs.
Challenge and get performance evaluation