The National Institute on Drug Abuse has spent $15 million on clinical trials to find out...

 

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The National Institute on Drug Abuse has spent $15 million on clinical trials to find out whether two vaccines can end the bad habits of nicotine and cocaine addiction. A Swiss company is now testing an obesity vaccine. If all of the vaccines are semi- successful such that treatment costs and medical bills are reduced by an average of $15,000 per person per year, what is the equivalent annual worth of the benefit of the vaccines for 10 million beneficiaries (i.e. people) in year one and an additional 15% benficiaries each year through year 5? Use an interest rate of 8% per year. The National Institute on Drug Abuse has spent $15 million on clinical trials to find out whether two vaccines can end the bad habits of nicotine and cocaine addiction. A Swiss company is now testing an obesity vaccine. If all of the vaccines are semi- successful such that treatment costs and medical bills are reduced by an average of $15,000 per person per year, what is the equivalent annual worth of the benefit of the vaccines for 10 million beneficiaries (i.e. people) in year one and an additional 15% benficiaries each year through year 5? Use an interest rate of 8% per year.

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To calculate the equivalent annual worth of the benefits of the vaccines we need to determine the pr... View the full answer