What is the present worth in year-1 dollars of the savings


The market for widgets is increasing by 15% per year from current profits of $2,000,000. Investing in a design change will allow the profit per widget to stay steady; otherwise the price will drop by 3% per year. If inflation in the economy is 4%, what is the present worth in Year-1 dollars of the savings over the next 5 years? The interest rate is 10%.

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Financial Management: What is the present worth in year-1 dollars of the savings
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