Explanation of Solution Time period is denoted by n and interest r denoted by i. Return on investment can be Spending = Save Annual (I+i)"- i(I+i)" %3D 2,500,000 = ( +i)-I i(I+i)0 1,200,000 i = 0.4698 Return on investment is 46.98%.

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
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Chapter1: Making Economics Decisions
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I am confused about the order of operations on this equation here. In what order do I need to move the various variables? Could you give me a step-by-step illustration as oppesed to simply the final answer for this equation?

Please see the image for the particular problem. Otherwise it is Problem 5P from Chapter 7 (Rate of Return) in Contemporary Engineering Economics 6th Edition.

Explanation of Solution
Time period is denoted by n and interest r
denoted by i. Return on investment can be
Spending = SaveAnnual
(1+1)"-I
i(14i)"
2,500,000 = 1,200.000 ( 1+i)º-1
i(I+i)
10
i= 0.4698
Return on investment is 46.98%.
Chapter 7, Problem 4P
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Transcribed Image Text:Explanation of Solution Time period is denoted by n and interest r denoted by i. Return on investment can be Spending = SaveAnnual (1+1)"-I i(14i)" 2,500,000 = 1,200.000 ( 1+i)º-1 i(I+i) 10 i= 0.4698 Return on investment is 46.98%. Chapter 7, Problem 4P Explore similar question
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