A firm has installed a manufacturing line for packaging materials. The firm plans to produce 45 tons of packing peanuts at $4000 per ton annually for 3 years, and then 60 tons of packing peanuts per year at $5000 per ton for the next 5 years. What is the present worth of the expected income? The firm’s interest rate is 15% per year.
A firm has installed a manufacturing line for packaging materials. The firm plans to produce 45 tons of packing peanuts at $4000 per ton annually for 3 years, and then 60 tons of packing peanuts per year at $5000 per ton for the next 5 years. What is the present worth of the expected income? The firm’s interest rate is 15% per year.
Chapter4: Time Value Of Money
Section: Chapter Questions
Problem 22P
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A firm has installed a manufacturing line for packaging materials. The firm plans to produce 45 tons of packing peanuts at $4000 per ton annually for 3 years, and then 60 tons of packing peanuts per year at $5000 per ton for the next 5 years. What is the present worth of the expected income? The firm’s interest rate is 15% per year.
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