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(a) The projected annual cost of natural gas in year 14 is $ (Round to nearest dollar) (b) The projected annual maintenance cost of the furnace in year 14 is $. (Round to nearest dollar) (c) The total present worth of operating and maintaining the furnace over the 14 years is $ (Round to nearest dollar)

(a) The projected annual cost of natural gas in year 14 is $ (Round to nearest dollar) (b) The projected annual maintenance cost of the furnace in year 14 is $. (Round to nearest dollar) (c) The total present worth of operating and maintaining the furnace over the 14 years is $ (Round to nearest dollar)

Elements Of Electromagnetics
Elements Of Electromagnetics
7th Edition
ISBN:9780190698614
Author:Sadiku, Matthew N. O.
Publisher:Sadiku, Matthew N. O.
ChapterMA: Math Assessment
Section: Chapter Questions
Problem 1.1MA
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Please answer all parts if possible if not at least the first two parts 

A small company heats its building using a gas furnace. It expects to spend $9,020 on natural gas this first year. The cost of the natural gas is expected to increase by 10% per year every subsequent year. There is also the maintenance cost on the gas furnace which is expected to be $851.00 in the first year and to increase by 15% per year every subsequent year. The planning horizon is 14 years and the company uses an annual interest rate of 18% for economic analysis of its investments. (a) The projected annual cost of natural gas in year 14 is $ (Round to nearest dollar) (b) The projected annual maintenance cost of the furnace in year 14 is $. (Round to nearest dollar) (c) The total present worth of operating and maintaining the furnace over the 14 years is $ (Round to nearest dollar)
Transcribed Image Text:A small company heats its building using a gas furnace. It expects to spend $9,020 on natural gas this first year. The cost of the natural gas is expected to increase by 10% per year every subsequent year. There is also the maintenance cost on the gas furnace which is expected to be $851.00 in the first year and to increase by 15% per year every subsequent year. The planning horizon is 14 years and the company uses an annual interest rate of 18% for economic analysis of its investments. (a) The projected annual cost of natural gas in year 14 is $ (Round to nearest dollar) (b) The projected annual maintenance cost of the furnace in year 14 is $. (Round to nearest dollar) (c) The total present worth of operating and maintaining the furnace over the 14 years is $ (Round to nearest dollar)
Expert Solution
Step 1: Introduction

Cost of natural gas in first year,  c equals $ 9020 space

The cost increment in the next year is k space equals 10 space percent sign

the total number of year is n equals 14

The maintenance cost of the furnace in the first year is c subscript 1 equals $ 851.00

The percentage increase of maintenance cost in the next years is k subscript 1 equals 15 percent sign

the annual interest rate is l space equals 18 space percent sign

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