62. Nu Things, Inc., is considering an investment in a business venture with the following anticipated cash flow results: EOY 0 1 2 3 4 5 6 Cash Flow EOY 7 -$70,000 20,000 19,000 18,000 17,000 16,000 15,000 8 9 10 11 12 13 Cash Flow 14,000 13,000 12,000 11,000 10,000 9,000 8,000 EOY 14 15 16 17 18 19 20 Cash Flow 7,000 6,000 5,000 4,000 3,000 2,000 1,000

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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62. Nu Things, Inc., is considering an investment in a business venture with the following anticipated cash flow
results:
EOY
0
1
2
3
4
5
6
Cash Flow EOY
7
-$70,000
20,000
19,000
18,000
17,000
16,000
15,000
8
9
10
11
12
13
Cash Flow EOY
14
15
14,000
13,000
12,000
11,000
10,000
9,000
8,000
16
17
18
19
20
Cash Flow
7,000
6,000
5,000
4,000
3,000
2,000
1,000
Transcribed Image Text:62. Nu Things, Inc., is considering an investment in a business venture with the following anticipated cash flow results: EOY 0 1 2 3 4 5 6 Cash Flow EOY 7 -$70,000 20,000 19,000 18,000 17,000 16,000 15,000 8 9 10 11 12 13 Cash Flow EOY 14 15 14,000 13,000 12,000 11,000 10,000 9,000 8,000 16 17 18 19 20 Cash Flow 7,000 6,000 5,000 4,000 3,000 2,000 1,000
63. Reconsider the data from Problem 62.
a. Plot a graph of FW versus MARR, where MARR varies from 0 percent to 50 percent by 1 percent increments.
FW should be on the y-axis and MARR on the x-axis.
b.
Explain the significance of the y-axis intercept.
c. Explain the significance of the x-axis intercept.
Transcribed Image Text:63. Reconsider the data from Problem 62. a. Plot a graph of FW versus MARR, where MARR varies from 0 percent to 50 percent by 1 percent increments. FW should be on the y-axis and MARR on the x-axis. b. Explain the significance of the y-axis intercept. c. Explain the significance of the x-axis intercept.
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