At an interest rate of 12% per year, the cash inflows generated by a gold mining operation are expected to be $225,000 starting in the fifth year, then annually decreasing in a uniform manner to reach Zero at the end of year 19. Draw the CFD and calculate the: a) gradient, b) overall equivalent annual worth.

Essentials Of Investments
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ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
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At an interest rate of 12% per year, the cash inflows generated by a gold mining
operation are expected to be $225,000 starting in the fifth year, then annually
decreasing in a uniform manner to reach Zero at the end of year 19.
Draw the CFD and calculate the:
a) gradient,
b) overall equivalent annual worth.
Transcribed Image Text:At an interest rate of 12% per year, the cash inflows generated by a gold mining operation are expected to be $225,000 starting in the fifth year, then annually decreasing in a uniform manner to reach Zero at the end of year 19. Draw the CFD and calculate the: a) gradient, b) overall equivalent annual worth.
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