Determine the present worth of the costs for this venture

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EmKay Fertilizer Company wishes to install a brand new equipment that costs $100,000 and has a life of 4 years. At the end of the 4-year period, it is estimated that it will cost the company $10,000 to dispose of the equipment. Operating and maintenance costs are estimated to be $7,500 for the first year. Thereafter, these O&M costs are expected to increase by $1,000 over the previous year's costs. If the annual interest rate is 15% per year compounded annually, determine the present worth of the costs for this venture.

Reference no: EM131169626

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