Question (2) Consider an EOY geometric gradient, which lasts for eight years, whose initial value at EOY one is $X1 and g = 6% per year thereafter. For an equivalent cash flow, find the equivalent uniform gradient amount, G over the same period if the initial value of the cash flows at the end of year one is $(X1-1000). The interest rate is x2% per year.
Question (2) Consider an EOY geometric gradient, which lasts for eight years, whose initial value at EOY one is $X1 and g = 6% per year thereafter. For an equivalent cash flow, find the equivalent uniform gradient amount, G over the same period if the initial value of the cash flows at the end of year one is $(X1-1000). The interest rate is x2% per year.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
X1= $6000 X2 = 18% write the complete equations used and
substitute the values of the factors to find the final answer.
Draw the cash flow diagram.
![Question (2) Consider an EOY geometric gradient, which lasts for eight years, whose initial value at EOY one is
$X1 and g = 6% per year thereafter. For an equivalent cash flow, find the equivalent uniform gradient amount, G
over the same period if the initial value of the cash flows at the end of year one is $(X1-1000). The interest rate is
x2% per year.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F57686267-e21c-410a-aa78-325eb43b9237%2Fab69e76b-d247-402a-b768-3871b6e23f6a%2Fklsvry_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Question (2) Consider an EOY geometric gradient, which lasts for eight years, whose initial value at EOY one is
$X1 and g = 6% per year thereafter. For an equivalent cash flow, find the equivalent uniform gradient amount, G
over the same period if the initial value of the cash flows at the end of year one is $(X1-1000). The interest rate is
x2% per year.
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