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What is the present worth in dollars of the savings

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Question: The market for widgets is increasing by 15% per year from current profits of $200,000. Investing in a design change will allow the profit per widget to stay steady; otherwise, it will drop by 3% per year. If inflation in the economy is 2%, what is the present worth in year-1 dollars of the savings over the next 5 years? 10 years? The interest rate is 10%.

Reference no: EM132168926

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