Reduce future production costs to improve company earnings

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A recently hired chief executive officer wants to reduce future production costs to improve the company’s earnings, thereby increasing the value of the company’s stock. The plan is to invest $70,000 now and $70,000 in each of the next 3 years to improve productivity. By how much must annual costs decrease in years 4 through 7 to recover the investment plus a return of 12% per year?

Reference no: EM131244358

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