Operate to make it economically feasible to build facility

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Reference no: EM131591314

The Southwest Trucking Company (STC) is a medium-sized freight line started with very limited capital to serve the independent gas station operators in the and Southwest. All of its trucks are identical. STC has been contracting its truck overhaul work to ABC Automotive for exist3, 300 per truck per year. STC estimates that, by building a exist600,000 maintenance facility with a life of 14 years and a residual (market) value of exist150,000 at the end of its life, they could handle their own overhaul at the cost of only exist1, 800 per truck per year. What is the minimum number of trucks that they must operate to make it economically feasible to build this facility? The MARR is 24 % per year. (Enter your answer as a number without the dollar exist sigh.)

Reference no: EM131591314

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