**Problem Statement:**1. Find the present worth at i = 10% per year for the cash flow series shown below.**Cash Flow Diagram Explanation:**The diagram represents a timeline indicating a series of cash flows occurring at different years. The timeline is divided into increments representing each year, labeled from 0 to 8.- **Year 0 (Starting Point):** No cash flow is shown.- **Year 1:** A cash outflow of $200 is indicated by a downward arrow.- **Year 2:** A cash outflow of $200 is indicated by a downward arrow.- **Year 3:** A cash outflow of $200 is indicated by a downward arrow.- **Years 4 and 5:** No cash flows are indicated.- **Year 6:** A cash outflow of $90 is indicated by a downward arrow.- **Year 7:** A cash outflow of $90 is indicated by a downward arrow.- **Year 8:** A cash outflow of $90 is indicated by a downward arrow.The task is to determine the present worth of these cash flows, considering an annual interest rate of 10%.

Here we calculate the Present worth of the cashflow so the calculation of the following by using the given data which are as follow-calculation of the present worth by using the data as follow- Given- Interest rate (i) = 10% per year Calculate the present worth of the cash flow series - PW = $200(P/F, 10%, 2) + $200(P/F, 10%, 3) + $200(P/F, 10%, 4) + $90(P/F, 10%, 6) + $90(P/F, 10%, 7) + $90(P/F, 10%, 8) PW = [$200 x 0.8264] + [$200 x 0.7513] + [$200 x 0.6830] + [$90 x 0.5645] + [$90 x 0.5132] + [$90 x 0.4665] PW = $165.28 + $150.26 + $136.60 + $50.81 + $46.19 + $41.99 PW = $591.33 so here we conclude that here ,The Present Worth of the Cash Flow Series is $591.33

Answered: 1. Find the present worth at i = 10%…

Business

Economics

1. Find the present worth at i = 10% per year for the cash flow series shown below. 2 3 8 Year 1 5 6 7 $90 $90 $90 $200 $200 S200

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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