For an engineering project, the following payments have been estimated to be paid at their certain time as follow: 1. The initial construction cost is $500000 which should be paid at the beginning of the construction period (time=0). 2. Extra expenditures are planned to be paid during operation period, which are: -$ 20000 at the end of the first three months, - $10000 at the end of the second three months, - S5000 at the end of the third three months, - Ten payments of $3000 at the end of each of the successive three months. - Fifteen payments started with $2000 at the end of the fourth three years and decreases by $100 at the end of each of the successive three months. If the interest rate is %12 compounded quarterly, draw the cash flow diagram and find the present worth of the project.

For an engineering project, the following payments have been estimated to be paid at their certain time as follow: 1. The initial construction cost is $500000 which should be paid at the beginning of the construction period (time=0). 2. Extra expenditures are planned to be paid during operation period, which are: -$ 20000 at the end of the first three months, - $10000 at the end of the second three months, - S5000 at the end of the third three months, - Ten payments of $3000 at the end of each of the successive three months. - Fifteen payments started with $2000 at the end of the fourth three years and decreases by $100 at the end of each of the successive three months. If the interest rate is %12 compounded quarterly, draw the cash flow diagram and find the present worth of the project.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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