Engineering Economy – Problem 2.35
Determine the difference in the present worth values of the following two commodity contracts at an interest rate of 8% per year.
Contract 1 has a cost of $10,000 in year 1; costs will escalate at a rate of 4% per year for 10 years.
Contract 2 has the same cost in year 1, but costs will escalate at 6% per year for 11 years.
Sample problems and notes are based on the following textbook: Engineering Economy 7th Edition
ISBN-13: 978-0073376301
ISBN-10: 0073376302
Edition: 7
Author: Leland Blank, Anthony Tarquin
Published Date: 2011
