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A small company heats its building and spends Php80,000 per year on natural gas for this purpose.Cost increases of natural gas are expected to be
A small company heats its building and spends Php80,000 per year on natural gas for this purpose.Cost increases of natural gas are expected to be 10% per year starting one year from now.Their maintenance on the gas furnace is Php3,450 per year, and this expense is expected to increase by 15% per year starting one year from now.If the planning horizon is 15 years, what is the total annual equivalent expenses for operating and maintaining the furnace? The interest rate is 12% per year.
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