Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter19: The Basic Tools Of Finance
Section: Chapter Questions
Problem 3CQQ
Related questions
Question
Please make a cash flow diagram for this problem. An example of the diagram is also attached below.

Transcribed Image Text:CFD:
A
A A A
3
18
19
20
950k
r.6%
Seln:
A = asoo00 (Ale, 6%,20)
0-66(1.06)20
asboos
1.0c0,
A = $ 82,821

Transcribed Image Text:Choose from the two machines which is more economical.
Machine A
Machine B
First Cost
Salvage value
Annual operation
Annual maintenance
P8,000
PO
P3,000
P1,200
P14,000
P2,000
P2,400
P1,000
3%
3%
10
Taxes and insurance
Life, years
10
Money is worth at least 16%.
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