A software company\'s labor requirements currently cost $320,000/year. The labor

Question

A software company's labor requirements currently cost $320,000/year. The labor-hour requirements are expected to increase by 8% per year over the next 5 years. If inflation is 5.5%, determine the labor costs after 5 years using: Then-current dollars. $ Carry all interim calculations to 5 decimal places and then round your final answer to the nearest dollar. The tolerance is plusminus 50. Constant-worth dollars. $ Carry all interim calculations to 5 decimal places and then round your final answer to the nearest dollar. The tolerance is plusminus 50.

Explanation / Answer

1.

nominal rate=((1.08)*(1.055))-1=13.94%

current dollars = 320000*(1.1394)^5=614513

2.

constant =320000*1.08^5=470185

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.