Find the amount of the company payments

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Reference no: EM131995417

A company is considering buying a CNC machine. In today's dollars, it is estimated that the maintenance costs for the machine (paid at the end of each year) will be $ 27,000 ,$29,000, $31,000, $33,000, and $ 36,000 for years 1 to 5, respectively. The general inflation rate (f overbar f) is estimated to be 6 % per year and the company will receive 15 % return (interest) per year on its invested funds during the inflationary period. The company wants to pay for maintenance expenses in equivalent equal payments? (in actual dollars) at the end of each of the five years. Find the amount of the company's payments.

Reference no: EM131995417

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