Fabrice is looking to buy a new plug-in hybrid vehicle. The purchase price is $13,000 more than a similar conventional model. However, he will receive a $5,800 federal tax credit that he will realize at the end of the year. He estimates that he will save $1,300 per year in gas over the conventional model; these cash outflows can be assumed to occur at the end of the year. The cost of capital (or interest rate) for Fabrice is 5%. How long will Fabrice have to own the vehicle to justify the additional expense over the conventional model? In other words, what is the DISCOUNTED payback period in years? Discount future cash flows before calculating payback rounded UP to a whole year. (Enter just the number without comma and round off decimals.)
Did you know you can hire someone to answer this question? Yes, classaider.com is a hub of paper writers dedicated to completing research and summaries, critical thinking tasks, essays, coursework, and other homework tasks. It is simple as ABC.