A machine priced at Rs. 20,000 has a service life of 8 years. The loan interest rate is 8% per annum. Given that the capital recovery factor for 8% interest over 8 years is 0.174, what is the machine's annual cost?

Construction Planning and Management MCQs for PPSC, FPSC, NTS, and Pakistan government job tests. Select an option below, then read the explanation.

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Subject
Construction Planning and Managementcivil-engineering-mcqs › construction-planning-and-management
Published
19 Jan 2019
Last updated
28 May 2026

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Explanation

To find the annual equipment cost, multiply the machine's cost by the capital recovery factor: Rs. 20,000 × 0.174 = Rs. 3,480. This represents the yearly expense considering both depreciation and interest.

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