Civil engineering consulting firms that provide services to outlying communities are vulnerable to a number of factors that affect the financial condition of the communities, such as bond issues, real estate developments, etc. A small consulting firm entered into a fixed$-$price contract with a spec home builder, resulting in a stable income of $$375,000$ per year in years $1$ through $8.$ At the end of that time, a mild recession slowed the development, so the parties signed another contract for $$175,000$ per year for $6$ more years. Determine the present worth of the two contracts at an interest rate of $7\%$ per year. The present worth of the two contracts is determined to be $Problem $03\mathrm{.}005$ Present Worth Calculations

Civil engineering consulting firms that provide services to outlying communities are vulnerable to a number of factors that affect the

financial condition of the communities, such as bond issues, real estate developments, etc. A small consulting firm entered into a fixed$-$

price contract with a spec home builder, resulting in a stable income of $$375,000$ per year in years $1$ through $8.$ At the end of that time,

a mild recession slowed the development, so the parties signed another contract for $$175,000$ per year for $6$ more years.

Determine the present worth of the two contracts at an interest rate of $7\%$ per year.

The present worth of the two contracts is determined to be $$???$