Silastic-LC-50 is a liquid silicon rubber designed to provide excellent clarity, superior mechanical properties, and short cycle time for high speed manufacturers. One high-volume manufacturer used it to achieve smooth release from molds. The company’s projected growth will result in silicon costs of $26,000 in years 1 and 2, with costs increasing by $2000 per year in years 3 through 5. At an interest rate of 10% per year, what is the present worth of these costs?
Silastic-LC-50 is a liquid silicon rubber designed to provide excellent clarity, superior mechanical properties, and short cycle time for high speed manufacturers. One high-volume manufacturer used it to achieve smooth release from molds. The company’s projected growth will result in silicon costs of $26,000 in years 1 and 2, with costs increasing by $2000 per year in years 3 through 5. At an interest rate of 10% per year, what is the present worth of these costs?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Silastic-LC-50 is a liquid silicon rubber designed
to provide excellent clarity, superior mechanical properties,
and short cycle time for high speed
manufacturers. One high-volume manufacturer
used it to achieve smooth release from molds. The
company’s projected growth will result in silicon
costs of $26,000 in years 1 and 2, with costs increasing
by $2000 per year in years 3 through 5. At
an interest rate of 10% per year, what is the present
worth of these costs?
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