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The overhead costs in an automated factory are expected to increase at an annual compound rate of 1 0 % for the next 7 years.

The overhead costs in an automated factory are expected to increase at an annual compound rate
of 10% for the next 7 years. The overhead cost at the end of the first year is $200000. What is the
annual worth of the overhead costs for the 7-year period? The time value of money rate is 8% per
year.
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