An electric oil pump’s first cost is $45,000, and the interest rate is 10%. The pump’s end-of-year..

An electric oil pump’s first cost is $45,000, and the interest rate is 10%. The pump’s end-of-year salvage values over the next 5 years are: Year               1             2          3           4          5 S             $42K     
 An electric oil pump’s first cost is $45,000, and the interest rate is 10%. The pump’s end-of-year salvage values over the next 5 years are: Year               1             2          3           4          5 S             $42K             40K       38K        32K      26K Determine the pump’s economic life. (a) Use the tabulated factors. (b) Use a spread sheet like Exbibit 10.3. (Answer: 3 years)