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# Answer to Question #244920 in Civil and Environmental Engineering for Alan Enrico V Tuib

Question #244920

A new municipal refuse-collection truck can be purchased for $84,000. Its expected useful life is six years, at which time its market value will be zero. Annual receipts less expenses will be approximately$18,000 per year over the six-year study period. Use the PW method and a MARR of 18% to determine whether this is a good investment.

1
2021-10-05T08:02:02-0400

PW

= - C0 + PW of annual receipt less expenses as annuity

"= - C0 + B * PVAF (n, r)\\\\\n\n= - 84,000 + 18,000 (6, 18 \\%)\\\\\n\n= - 84,000 + 18,000 \/ 18 \\% \\times [1 - (1 + 18 \\%)-6]\\\\\n\n= -21,043.15\\\\"

Since the PW is negative, this is not a good investment.

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