7/ A company is trying to decide how much to sell their new Widget that can...

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7/ A company is trying to decide how much to sell their new Widget that can save $1,500/yr in energy costs. Their clients use

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Answer 1

Answer #1

Information provided:

Yearly saving= $1,500

Discount rate= 8%

Time= 4 years

The question is solved by computed by calculating the present value.

Enter the below in a financial calculator to compute the present value:

PMT= 1,500

I/Y= 8

N= 4

Press the CPT key and PV to compute the present value.

The value obtained is 4,968.1903.

Therefore, they can sell the product for $4,968.19.

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Answer 2

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