Answered: Your department is budgeting…

Your department is budgeting miscellaneous expenses for the next 5 years. Your best guess at the annual inflation rate is 3.9%, and the combined MARR is 15%. Expenses currently run $14,500 per

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Please answer correctly and quickly Part b Determine the real dollar amount for years 1, 2, 3, 4, and 5 Part c Determine the actual dollar amount for years 1, 2, 3, 4, and 5 Part c

Your department is budgeting miscellaneous
expenses for the next 5 years. Your best guess at the
annual inflation rate is 3.9%, and the combined
MARR is 15%. Expenses currently run $14,500 per
year. Assume that expenses are end-of-year
payments.

Determine the constant dollar amount for years
1, 2, 3, 4, and 5.
ΕΟΥ
Constant Dollar Amount
1
3
2 $
4
$
LA
5
LA
$
$
$
tA
Carry all interim calculations to 5 decimal
places and then round your final answer to
the nearest dollar. The tolerance is ±5.

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