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An employee of the central government is using a car which is eight years old. It can be sold now at Rs. 2.26 lakhs or can be kept for another seven years. In that case the annual operation and maintenance cost will be Rs. 0.34 lakhs, one-time expenditure of Rs. 0.31 lakhs after 3 years and a salvage value of Rs. 0.8 lakh at the end of 7th year. what is the annual worth of the existing car at 8% rate of interest?

2 An employee of the central government is using a car which is eight years old. A suitable replacement is available at Rs. 7.63 lakhs, annual operation and maintenance cost of Rs. 0.15 lakhs, one-time expenditure of Rs. 0.65 lakhs at the fifth year and salvage value of Rs. 2.59 lakhs at the end of 10th year. what is the annual worth of the new car at 8% rate of interest?

3 A person working for a private company owns a house to spend the retirement life. Currently she is 25 years old and plans to retire from the corporate job at the age of 55. For this purpose, she wants to setup a fund to finance the-post retirement expenses for perpetuity. She thinks that having an annual income of Rs. 59.06 lakhs to take care of the post-retirement expenses after taking into account inflation. If she wants to setup a fund by contributing equal annual amounts and invest it at 15% rate of return, how much money needs to be saved annually?

4 An employee of the central government is using a car which is eight years old. A suitable replacement is available at Rs. 7.63 lakhs, annual operation and maintenance cost of Rs. 0.15 lakhs, one-time expenditure of Rs. 0.65 lakhs at the fifth year and salvage value of Rs. 2.59 lakhs at the end of 10th year. what is the annual worth of the new car at 8% rate of interest?

5 A company must decide whether to provide their employees with company-owned vehicle or to pay the mileage allowance for their travel from residence to workplace and return. New automobiles would cost about Rs 921.26 lakhs and could be sold five years later for about Rs 398.72 lakhs. Annual operating costs would be Rs. 48.04 lakhs per year and a variable cost of Rs 0.0021 lakh per kilometre. Alternatively, the company will have to pay Rs. 0.0413 lakh per kilometre if it chooses to pay the mileage allowance. Assuming an 8% effective annual interest rate, what is the breakeven between the alternatives?

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