Find the present worth of earthmoving equipment that has a first cost today of $150,000, an annual operating cost of $60,000, and a salvage value of 20% of the first cost after 5 years; these estimates being in future dollars. Assume the interest rate is 10% per year and that inflation has averaged 7% per year. Solve by hand and spreadsheet with inflation (a) not accounted for, and (b) accounted for.

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