Answered: Convert the following cash flow in…

Convert the following cash flow in figure A to an equivalent annual worth payment series at t=2,3,4, where i=2%. a. $798.26 $800 $800 b. $600 c. $2302.13 $500 d. $500 $300 1 3 5 6 2.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Concept explainers

Cash Flow in Engineering Economics (Interest and Equivalence)

The cash flows of a firm are of two categories such as cash inflows and cash outflows. Cash inflow is the money or income entering a firm during a specific period whereas cash outflow is the money exiting a firm during a specific period in the form of the expenses incurred by the firm. In other words, we can say that cash flow is a series of expenses and credits that run over the project over the lifetime it existed whereas cash inflows are all the income and gains the company earns as a result of its operations.

Question

Convert the following cash flow in figure A to an equivalent annual worth payment series at t=2,3,4, where i=2%.
a. S798.26
$800
$800
b. $600
c. S2302.13
$500
d. $500
$300
1
2
4
6
5.
3.

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