A machine is estimated to have annual repair costs of $20000 a year for five years. The cost are not anticipated to begin until four years from now.lf Capital isworth 12% compounded annually what would be the present value of these repair costs? Please drawthe cash flow diagram as well.

A machine is estimated to have annual repair costs of $20000 a year for five years. The cost are not anticipated to begin until four years from now.lf Capital isworth 12% compounded annually what would be the present value of these repair costs? Please drawthe cash flow diagram as well.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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A machine is estimated to have annual repair costs of $20000 a year for five
years. The cost are not anticipated to begin until four years from now.If
Capital isworth 12% compounded annually what would be the present value
of these repair costs? Please drawthe cash flow diagram as well.

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