The capital investment for a new highway paving machine is $950,000. The estimated annual expense, in year zero dollars, is $92,600. This expense is estimated
The capital investment for a new highway paving machine is $950,000. The estimated annual expense, in year zero dollars, is $92,600. This expense is estimated to increase at the rate of 5.7% per year. Assume that f = 4.5%, N = 7 years, MV at the end of year 7 is 10% of the capital investment, and the MARR (in real terms) is 10.05% per year. What uniform annual revenue (before taxes), in actual dollars, would the machine need to generate to break even?
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