Determine the present worth of a maintenance contract that has a cost of $30,000 in year 1 and annual increases of 6% per year for 10 years. Use an interest rate of 6% per year. Draw a cash flow diagram.

International Financial Management
14th Edition
ISBN:9780357130698
Author:Madura
Publisher:Madura
Chapter14: Multinational Capital Budgeting
Section: Chapter Questions
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Determine the present worth of a maintenance contract that has a cost of $30,000 in year 1 and
annual increases of 6% per year for 10 years. Use an interest rate of 6% per year. Draw a cash flow diagram.

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