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Show Detailed Solution 359. A machine has been purchased and installed at a total cost of P1800000. The machine will be retired at the end

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359. A machine has been purchased and installed at a total cost of P1800000. The machine will be retired at the end of 5 years. at which time it is expected to have a scrap value of P200000 based on current prices. The machine will then be replaced with an exact duplicate. The company plans to establish a reserve fund to accumulate the capital needed to replace the machine. if an average annual rate of ination of 3% is anticipated, how much capital must be accumulated? - A. P1503000 - B. P1238200 - C. P18,548.3g - D. P1538600 360. If the ination rate is 6%, cost of money is 10%, what interest rate will take care of inflation and the cost of money? - A. 16.6% - B. 17.7% - C. 15.5% H . _ _I

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