Present worth of the investment at marr

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A $10,000 investment can be made today that will produce savings of $2,000 annually for the next 7 years. There is no salvage value involved. Calculate the present worth of the investment at MARR = 10%. Show that the same PW results when the constant-dollar savings inflate at 8% annually. Apply the combined interest-inflation rate to discount the actual-dollar cash flow.

Reference no: EM132654774

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