A facility manager intends to purchase a medical air compressor costing $2,600. The manufacturer has stated the energy-efficient motor will save 10% on electric usage. History indicates it will cost $300 in repairs each year.

The total capital dollar amount is:

A) $2,600
B) $2,870
C) $2,930
D) $3,070

Question

03-10-2024
Business

High School

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A facility manager intends to purchase a medical air compressor costing $2,600. The manufacturer has stated the energy-efficient motor will save 10% on electric usage. History indicates it will cost $300 in repairs each year.

The total capital dollar amount is:

A) $2,600
B) $2,870
C) $2,930
D) $3,070

Answer :

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akibkhanzai12 akibkhanzai12 · Answer 1 · 2023-08-13T16:17:12-04:00

Final answer:

The correct option is A) $2,600. The total capital dollar amount for the compressor at the time of purchase is the cost of the compressor itself, which is $2,600 (Option A), as the question seems to be asking for the initial outlay only.

Explanation:

The correct option is A) $2,600. To determine the total capital dollar amount for the medical air compressor, we must consider the initial purchase price of the compressor itself and any expected annual repair costs that will add to the overall costs over time.

According to the information provided, the compressor costs $2,600, and it is expected that it will require $300 in repairs each year. However, the question appears to be asking for the initial outlay only, without factoring in the future repair costs or the energy savings due to the efficient motor. Therefore, the total capital dollar amount at the time of purchase is simply the cost of the compressor, which is $2,600 (Option A).