Essentials Of Cost Accounting For Health Care Organizations 3rd Edition by Steven Finkler, David Ward,Judith Baker

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Net Present Cost. ABC Hospice is building an extension. They can use single-pane glass windows that cost $150 each, or they can buy double-pane windows that cost $200 each. The windows should last 20 years before they have to be replaced. The hospice expects that heating costs will be lower by $5 per year for each double-pane window they buy. The hospice can borrow or invest money at 10 percent. Which type of window should they buy? What would your answer be if the interest rate was 6 percent? Why did changing the interest rate change the answer?