Under an agreement with the Internet Service Providers (ISPs) Association, SBC Communications reduced the price it charges ISPs to resell its high-speed digital subscriber line (DSL) service from $458 to $360 per year per customer line for the next 5 years. A particular ISP, which has 20,000 customers, plans to pass 90% of the savings along to its customers. What is the total present worth of these savings at an interest rate of 10% per year?
Under an agreement with the Internet Service Providers (ISPs) Association, SBC Communications reduced the price it charges ISPs to resell its high-speed digital subscriber line (DSL) service from $458 to $360 per year per customer line for the next 5 years. A particular ISP, which has 20,000 customers, plans to pass 90% of the savings along to its customers. What is the total present worth of these savings at an interest rate of 10% per year?
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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Under an agreement with the Internet Service Providers (ISPs) Association, SBC Communications reduced the price it charges ISPs to resell its high-speed digital subscriber line (DSL) service from $458 to $360 per year per customer line for the next 5 years. A particular ISP, which has 20,000 customers, plans to pass 90% of the savings along to its customers. What is the total present worth of these savings at an interest rate of 10% per year?
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