On the first day of the year, a man deposits 50,000 in a bank at 8% per year, compounded annually. He withdraws 4,000.00 at the end of the first year, 4,500.00 at the end of the second year, and the remaining balance at the end of the third year. (a) Draw the cash flow diagram? (b) How much does he withdraw at the end of the third year? (c) How much better off, would he have been if he had not made the withdrawals at the ends of years one and two?

On the first day of the year, a man deposits 50,000 in a bank at 8% per year, compounded annually. He withdraws 4,000.00 at the end of the first year, 4,500.00 at the end of the second year, and the remaining balance at the end of the third year. (a) Draw the cash flow diagram? (b) How much does he withdraw at the end of the third year? (c) How much better off, would he have been if he had not made the withdrawals at the ends of years one and two?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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