The total annual equivalent expense for operating

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Reference no: EM131012078

A small company heats its building and spends $8,800 per year on natural gas for this purpose. Cost increases of natural gas are expected to be 9% per year starting one year from now (i.e., the first cash flow is $9,592 at EOY one). Their maintenance on the gas furnace is $345 per year, and this expense is expected to increase by 12% per year starting one year from now (i.e., the first cash flow for this expense is $386.40 at EOY one). If the planning horizon is 13 years, what is the total annual equivalent expense for operating and maintaining the furnace? The interest rate is 18% per year.

The total annual equivalent expense for operating and maintaining the furnace is $_____ thousands. (Round to 3 decimal places)

Reference no: EM131012078

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The total annual equivalent expense for operating : A small company heats its building and spends $8,800 per year on natural gas for this purpose. Cost increases of natural gas are expected to be 9% per year starting one year from now (i.e., the first cash flow is $9,592 at EOY one). The total annual ..

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