Problem
Perform a financial analysis for a project. Assume that the projected costs and benefits for this project are spread over four years as follows:
Estimated costs are $300,000 in Year 1 and $ 75,000 each year in Years 2, 3, and 4.
Estimated benefits are $0 in Year 1 and $130,000 each year in Years 2, 3, and 4.
Use a 5 percent discount rate, and round the discount factors to two decimal places.
What is the discount cost in year 4?