College

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.

What is the total capital dollar amount?

a) $2,670
b) $2,770
c) $2,800
d) $2,900

Answer :

Final answer:

The total capital dollar amount of the medical air compressor is the sum of its initial cost and the first year's repair costs, equalling $2,900 (option d).

Explanation:

The student has asked how to calculate the total capital dollar amount of a medical air compressor with specific cost and repair factors. The answer lies in combining the initial cost of the compressor with the annual repair costs. Given that the compressor costs $2,600 and requires $300 in repairs each year, the total capital dollar amount for the first year would be the sum of these two figures. This assumes that the cost savings on electric usage are not subtracted from the total capital cost but rather realized in operational savings over time.

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