1. An independent contractor for a transportation company needs to determine whether she should upgrade the vehicle she currently

owns or trade her vehicle in to lease a new vehicle. If she keeps her vehicle, she will need to invest in immediate upgrades that cost

$5,000 and it will cost $1,500 per year to operate at the end of year that follows. She will keep the vehicle for 4 years; at the end of this

period, the upgraded vehicle will have a salvage value of $4,000. Alternatively, she could trade in her vehicle to lease a new vehicle. She

estimates that her current vehicle has a trade-in value of $10,000 and that there will be $4,500 due at lease signing. She further

estimates that it will cost $3,000 per year to lease and operate the vehicle. The independent contractor's MARR is 12%. Compute the

EUAC of both the upgrade and lease alternatives using the insider perspective.