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1. Under an agreement with the Internet Service Providers (ISPs) Association, ATT Communica- tions reduced the price it charges ISPs to resell its high-speed digital subscriber line (DSL) service from $458 to $360 per year per customer line. A particular ISP, which has 20,000 customers, plans to pass 90% of the savings along to its customers. What is the total future worth of these savings in year 5 at an interest rate of 10% per year?

2. Southwestern Moving and Storage wants to have enough money to purchase a new tractor-trailer in 5 years at a cost of $290,000. If the company sets aside $100,000 in year 2 and $75,000 in year 3, how much will the company have to set aside in year 4 in order to have the money it needs if the money set aside earns 9% per year?

Microeconomics, Economics

  • Category:- Microeconomics
  • Reference No.:- M91720008

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