A large electronic retailer is considering the purchase of software that will minimize shipping expenses in its supply chain network. This software, including installation and training, would be a 12 million investment for the retailer. If the firms effective interest rate is 20% per year and the life of the software is five years, what annual savings in shipping expenses must theee be to justify the purchase of the software?

Discrete Compounding; i 20% Single Payment Uniform Series AmountPresent Sinking Fund Factor Worth Factor Factor Recovery Factor Worth Factor To Find F To Find PTo Find A Given F To Find A Given P AT To Find PTo Find F Given P Given F Given AGiven A A/F 1.0000 0.4545 0.2747 0.1863 0.1344 0.8333 1.5278 2.1065 2.5887 2.9906 9.9299 3.3255 0.1007 .6046 3.8372 4.0310 4.1925 1.2000 1.4400 1.7280 2.07360.4823 2.4883 2.9860 3.5832 0.8333 0.6944 0.5787 10000 2.2000 3.6400 5.3680 1.2000 0.6545 0.4747 0.3863 0.3344 0.3007 0.4019 0.3349 0.2791 0.2326 0.1938 0.07740.2774 0.0606 0.0481 0.0385 2.9159 16.4991 20.7989 0.2606 0.2481 0.2385 5.1598