Project Balance -$1,000 -$1,000 1 () -1,100 2 () -800 3 460 - 500 4 () (a) Construct the original cash flows of the project. (b) Determine the interest rate used in computing the project balance (c) Would the project be acceptable at i = 15%?

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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q5.11

5.11 Consider the following project balances for a typical investment project with a
service life of four years:
An
Project Balance
- $1,000
()
()
-$1,000
1
-1,100
-800
3
460
-500
4
()
(a) Construct the original cash flows of the project.
(b) Determine the interest rate used in computing the project balance.
(c) Would the project be acceptable at i = 15%?
Transcribed Image Text:5.11 Consider the following project balances for a typical investment project with a service life of four years: An Project Balance - $1,000 () () -$1,000 1 -1,100 -800 3 460 -500 4 () (a) Construct the original cash flows of the project. (b) Determine the interest rate used in computing the project balance. (c) Would the project be acceptable at i = 15%?
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