1117 a piece of equipment has a first cost of 150000 a maximum useful
11.17 A piece of equipment has a first cost of $150,000, a maximum useful life of 7 years, and a market (salvage) value described by the relation S = 120,000-20,000 k, where k is the number of years since it was purchased. The salvage value cannot go below zero.The AOC series is estimated using AOC= 60,000 +10,000 k. The interest rate is 15% per year. Deter-mine the economic service life (a) by hand solution,using regular AW computations, and (b) by spread-sheet, using annual marginal cost estimates.
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