What would be maximum initial price that would be justified

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Question: Maximum price to justify. What would be the maximum initial price that would be justified if a new machine were added with the following properties? It would cost 5000 dollars a year to maintain in the first year and each year after that the maintenance cost would increase by 2000 dollars a year. It would save 30000 a year in raw materials. The planning horizon is10 years and the interest rate is 3%.

Reference no: EM131996260

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