Determine the present worth of the following cash flows based on an interest rate of 7.63% per year, compunded annually. End of Year 0 = Php 5950 End of Year 1 = Php 5051 End of Year 2 = Php 5609 End of Year 3 = Php 5850 End of Year 4 = Php 5758 End of Year 5 = Php 5650

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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.