2. A water resources project has benefits that equal $40,000 at the end of the first year and increase on a uniform gradient series to $200,000 at the end of the fifth year. The benefits remain constant at $200,000 each year until the end of year 30, after which they decrease to $0 on a uniform gradient at the end of year 40. What is the present value of these benefits using a 6-percent interest rate?
2. A water resources project has benefits that equal $40,000 at the end of the first year and increase on a uniform gradient series to $200,000 at the end of the fifth year. The benefits remain constant at $200,000 each year until the end of year 30, after which they decrease to $0 on a uniform gradient at the end of year 40. What is the present value of these benefits using a 6-percent interest rate?
Chapter16: The Markets For Labor, Capital, And Land
Section: Chapter Questions
Problem 12P
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![2. A water resources project has benefits that equal $40,000 at the end of the first year
and increase on a uniform gradient series to $200,000 at the end of the fifth year. The
benefits remain constant at $200,000 each year until the end of year 30, after which
they decrease to $0 on a uniform gradient at the end of year 40. What is the present
value of these benefits using a 6-percent interest rate?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb36f528e-b492-4ce2-8280-a22677d3661a%2Fad471362-9205-4216-8f38-b4ce01644dcd%2Fc303kca_processed.jpeg&w=3840&q=75)
Transcribed Image Text:2. A water resources project has benefits that equal $40,000 at the end of the first year
and increase on a uniform gradient series to $200,000 at the end of the fifth year. The
benefits remain constant at $200,000 each year until the end of year 30, after which
they decrease to $0 on a uniform gradient at the end of year 40. What is the present
value of these benefits using a 6-percent interest rate?
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