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A company anticipates spending $250,000 on product research each year for the next five years with the first expense occurring one year from today. The company also anticipates that competition will cause them to increase their research expense by $20,000 in year 2, and by the same amount again in years 3, 4, and 5 (or an arithmetic gradient of $20,000 per year beginning in year 2). What is the total present worth of all of these research expenses if the interest rate is 8%?

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Financial Accounting, Accounting

Category:- Financial Accounting
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