What is the uniform annual equivalent maintenance cost

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Reference no: EM131098695

Add a cash flow diagram to it and a detailed solution and show the formula you used

Part 1

a. The maintenance on a machine is expected to be $155 at the end of the first year, then increasing by $35 each year for the next 7 years. What sum of money would need to be set aside now to pay the maintenance for the 8-year period? Assume 6% interest.

b. What is the uniform annual equivalent maintenance cost for the above machine? Compute an equivalent A for the maintenance costs.

Reference no: EM131098695

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