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For the following cash flow series, a. Show both hand and spreadsheet solutions that calculate the expected present worth if each series may be realized with the probability shown at the head of each column. Let I = 20% per year b. Determine the expected annual worth value for the same cash flow series. Year 0 1 123 2 Annual Cash Flow, $ per year Prob = 0.5 -5000 1000 1000 1000 Prob = 0.2 -6000 500 1500 2000 Prob = 0.3 -4000 3000 1200 -800

For the following cash flow series, a. Show both hand and spreadsheet solutions that calculate the expected present worth if each series may be realized with the probability shown at the head of each column. Let I = 20% per year b. Determine the expected annual worth value for the same cash flow series. Year 0 1 123 2 Annual Cash Flow, $ per year Prob = 0.5 -5000 1000 1000 1000 Prob = 0.2 -6000 500 1500 2000 Prob = 0.3 -4000 3000 1200 -800

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
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For the following cash flow series, a. Show both hand and spreadsheet solutions that calculate the expected present worth if each series may be realized with the probability shown at the head of each column. Let I = 20% per year b. Determine the expected annual worth value for the same cash flow series. Year 0 123 3 Annual Cash Flow, $ per year Prob = 0.5 -5000 1000 1000 1000 Prob = 0.2 -6000 500 1500 2000 Prob = 0.3 -4000 3000 1200 -800
Transcribed Image Text:For the following cash flow series, a. Show both hand and spreadsheet solutions that calculate the expected present worth if each series may be realized with the probability shown at the head of each column. Let I = 20% per year b. Determine the expected annual worth value for the same cash flow series. Year 0 123 3 Annual Cash Flow, $ per year Prob = 0.5 -5000 1000 1000 1000 Prob = 0.2 -6000 500 1500 2000 Prob = 0.3 -4000 3000 1200 -800
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