Chapter 8.8, Problem 78E

Capitalized Cost In Exercises 77 and 78, find the capitalizedcost C of an asset (a) for $n=5$ years, (b) for $n=10$ years, and(c) forever. The capitalized cost is given by $C=C_0+{\displaystyle {\int }_0^{n}c(t)e^{-rt}dt}$

where $C_0$ is the original investment, t is the time in years, r isthe annual interest rate compounded continuously, and c(t) isthe annual cost of maintenance.

$\begin{array}{l}{C}_0=\$700,000\\ c(t)=\$25,000(1+0.08t)\\ r=0.06\end{array}$