2.21. An investment of $100,000 is required to expand a certain production facility in a manufacturing company. The firm estimates that labor costs will be $150,000 for the first year but will increase at the rate of 8% over the previous year's expenditure. Material costs, on the other hand, will be $400,000 for the first year but will increase at the rate of 10% per year due to inflation. If the firm's inflation-free interest rate (i') is 10% and the average general inflation rate (f) is expected to be 5% over the next 5 years, determine the total present equivalent operating expenses (with no tax consideration) for the project