What is the lifetime cost savings of the 100 cases in Exercise 5 at a 3 percent rate of discount? Solve Recall that the formula is: Cost/(03)t, where t is time in the future. For simplicity, assign year 1 savings equal to $1,000 and begin discounting in year 2.

You are asked to evaluate the cost returns associated with one year of operation. Which costs are counted over the one-year period, and which costs go beyond this one-year period? Solve (Hint: Think about the future cost savings associated with the initial investment.)