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Problem 4: A piece of heavy equipment can be purchased for $85,000 now or for an estimated $130,000 five years from now. At a real
Problem 4: A piece of heavy equipment can be purchased for $85,000 now or for an estimated $130,000 five years from now. At a real interest rate of 10% per year and an inflation rate of 6% per year, determine if the company should buy now or later with inflation considered.
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