A communication system cost $65 000 to buy and $4 000 to install ten years ago. Currently the ten-year-old system can be sold for $7 000, but it will cost $1 000 to remove it. If it's sold in a year's time, the net income, after paying removal costs, will be $1 000. A new communication system costs $50 000 plus $500 to install it. Assuming 5% depreciation rate for the new system, 7% annual interest rate, by how much would the operating costs of the old system have to exceed operating costs of the new one for the old system to be replaced immediately?

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The Answer of A communication system cost $65 000 to buy and $4 000 to install ten years ago. Currently the ten-year-old system can be sold for $7 000, but it will cost $1 000 to remove it. If it's sold in a year's time, the net income, after paying removal costs, will be $1 000. A new communication system costs $50 000 plus $500 to install it. Assuming 5% depreciation rate for the new system, 7% annual interest rate, by how much would the operating costs of the old system have to exceed operating costs of the new one for the old system to be replaced immediately?

A Communication System Cost $65 000 to Buy and $4