Question: Under an agreement with the Internet Service providing…

Under an agreement with the Internet Service Providers (ISPs) Association, SBC Communications 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 pass90% of the savings along to its customers. What is the total future worth of these savings over a 5-year horizon at an interest rate of 8% per year?

Engineering Econ. Problem