How would this look over 20 years worth of buses building inflation into the warranty?

Avg. Inflation rate is 3% per year.

Warranty cost per year = 1000+500 = 1500 a Present value of annuity= p* [[1- (1+r) -^ ]/r] P= Periodic payment 1,500.00 r= Rate of interest per period Annual interest 3.00% Number of payments per year 1 Interest rate per period 0.03/1= Interest rate per period 3.000% n= n= number of periods: Number of years 5 Periods per year 1 number of payments 5 Present value of annuity= 1500* [(1- (1+0.03)^-5)/0.03 ] Present value of annuity= 6,869.56 Present value of warranty cost per each bus is: 6,869.56