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# Question : Please show formulas and steps. How do : 3958

How do I construct a decision tree in Excel using the following criteria:

A decision is being made on whether to purchase a used car or keep up maintenance costs on the older current car.

The used car has 30,000 miles on it, while the current car has 200,000 miles on it. The expectency of the used car is 200,000 miles, while the current car is 300,000 if it is kept maintained.

Purchasing a used car would cost \$27,000 to purchase (\$450 per month for 60 months) at a 7% interest rate, and would increase the car insurance payments from \$1,100 to \$1,800 per year.

Keeping the current car costs \$350 per month to maintain (on parts, old changes, etc.)

The driver logs in an average of 2,800 miles per month, so this would be true for either car.

The following link has an example of a decision table and decision tree: https://www.dropbox.com/s/gtf2u0gx0hr27mw/Decision%20Tree%20M2DQ2%20Villicana.xlsx?dl=0

## Solution 5 (1 Ratings )

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Accounting 10 Months Ago 210 Views