A certain piece of equipment is available from two different manufacturers. Either can be purchased for $40,000. The machine from Company A depreciates $2,500 per year and has a life span of 15 years. The machine from Company B loses 10% of its value each year and has a 20-year life span. Find the scrap value of each machine to the nearest dollar.a)$1,783, $4,863b)$2,500, $3,284c)$5000, $4000d)$2,500, $1,783e)$2,500, $4,863Correct answer is option 'E'. Can you explain this answer?

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A certain piece of equipment is available from two different manufacturers. Either can be purchased for $40,000. The machine from Company A depreciates $2,500 per year and has a life span of 15 years. The machine from Company B loses 10% of its value each year and has a 20-year life span. Find the scrap value of each machine to the nearest dollar.

a)
$1,783, $4,863
b)
$2,500, $3,284
c)
$5000, $4000
d)
$2,500, $1,783
e)
$2,500, $4,863

Correct answer is option 'E'. Can you explain this answer?

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A certain piece of equipment is available from two different manufactu...

The machine from Company A loses $2,500 of value each year for 15 years, leaving a scrap value of $40,000 – 15($2,500) = $40,000 – $37,500 = $2,500. The machine from Company B loses 10% of its value each year, or seen another way, its value each year is 90% of the previous year’s value. Its scrap value after 20 years is (0.90)20 × $40,000 = $4,863 (and about 7 cents).

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A certain piece of equipment is available from two different manufacturers. Either can be purchased for $40,000. The machine from Company A depreciates $2,500 per year and has a life span of 15 years. The machine from Company B loses 10% of its value each year and has a 20-year life span. Find the scrap value of each machine to the nearest dollar.a)$1,783, $4,863b)$2,500, $3,284c)$5000, $4000d)$2,500, $1,783e)$2,500, $4,863Correct answer is option 'E'. Can you explain this answer? for GMAT 2025 is part of GMAT preparation. The Question and answers have been prepared according to the GMAT exam syllabus. Information about A certain piece of equipment is available from two different manufacturers. Either can be purchased for $40,000. The machine from Company A depreciates $2,500 per year and has a life span of 15 years. The machine from Company B loses 10% of its value each year and has a 20-year life span. Find the scrap value of each machine to the nearest dollar.a)$1,783, $4,863b)$2,500, $3,284c)$5000, $4000d)$2,500, $1,783e)$2,500, $4,863Correct answer is option 'E'. Can you explain this answer? covers all topics & solutions for GMAT 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A certain piece of equipment is available from two different manufacturers. Either can be purchased for $40,000. The machine from Company A depreciates $2,500 per year and has a life span of 15 years. The machine from Company B loses 10% of its value each year and has a 20-year life span. Find the scrap value of each machine to the nearest dollar.a)$1,783, $4,863b)$2,500, $3,284c)$5000, $4000d)$2,500, $1,783e)$2,500, $4,863Correct answer is option 'E'. Can you explain this answer?.

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