Determine the difference in the present worth values

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Determine the difference in the present worth values of the following two contracts at an interest rate of 8% per year.

Contract 1 has a cost of $10,000 in year 1; costs will escalate at a rate of 6% per year for 10 years.

Contract 2 has the same cost as year 1, but costs will escalate at 2% per year for 11 years

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Reference no: EM132266554

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