Chapter 3 Time Value of Money

Find the net present value of the costs associated with this model of word processor. The present value of purchasing the 10 EVF word processors is: PV(Purchase) = 10 * -$8,000 = -$80,000 The present value of the maintenance costs is found by using a four-year annuity, discounted at 14 percent. PV(Maintenance Costs) = (-$2,000*10) A40.14 = -$58,274 ................
................