A storage tank for toxic chemicals has an initial cost of $20,000. The tank is expected to last for 25 years, at which point it is discarded with no salvage value.
Every five years during its use, the tank must be drained and relined at a cost of $8,000. Plant managers want to invest a lump sum of money now to cover the cost of the tank and the relining. Determine the amount of money required to be invested at an annual rate of 12% compounded monthly to completely pay for tank and relining.