A restaurant is upgrading its dining room for $20,000. The upgrade will bring in a continuous stream of $8,000 in extra income each year. If the restaurant invests this extra income in an account that earns 6% continuously compounded interest for 2 years, is the upgrade worthwhile? Select the correct answer below: Yes, because the present value of the O investment is about $5,000 greater than the cost of the upgrade. Yes, because the present value of the O investment is about $9,000 greater than the cost of the upgrade. No, because the present value of the investment is about $9,000 less than the cost of the upgrade. No, because the present value of the investment is about $5,000 less than the cost of the upgrade.
A restaurant is upgrading its dining room for $20,000. The upgrade will bring in a continuous stream of $8,000 in extra income each year. If the restaurant invests this extra income in an account that earns 6% continuously compounded interest for 2 years, is the upgrade worthwhile? Select the correct answer below: Yes, because the present value of the O investment is about $5,000 greater than the cost of the upgrade. Yes, because the present value of the O investment is about $9,000 greater than the cost of the upgrade. No, because the present value of the investment is about $9,000 less than the cost of the upgrade. No, because the present value of the investment is about $5,000 less than the cost of the upgrade.
Advanced Engineering Mathematics
10th Edition
ISBN:9780470458365
Author:Erwin Kreyszig
Publisher:Erwin Kreyszig
Chapter2: Second-order Linear Odes
Section: Chapter Questions
Problem 1RQ
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Transcribed Image Text:A restaurant is upgrading its dining room for
$20,000. The upgrade will bring in a
continuous stream of $8,000 in extra income
each year. If the restaurant invests this extra
income in an account that earns 6%
continuously compounded interest for 2 years,
is the upgrade worthwhile?
Select the correct answer below:
Yes, because the present value of the
investment is about $5,000 greater
than the cost of the upgrade.
Yes, because the present value of the
investment is about $9,000 greater
than the cost of the upgrade.
No, because the present value of the
O investment is about $9,000 less than
the cost of the upgrade.
No, because the present value of the
O investment is about $5,000 less than
the cost of the upgrade.
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