QUESTION 2. For the cash flows shown below, determine (a) the future worth in year 6 and (b) the equivalent Annual value for years 0 through 12. (Use gradient and annual equivalent series formulas in calculations) Cash Flow S/yr -50000 Year 0 1-2 3-5 6 7 8 9 10 11-12 6000 6000 5500 6000 6500 7000 7500 8000 Interest ratio Monthly effective interest rate (2+0*0,1)% (7+4)% per year, compounded quarterly Effective interest rate for 24 months (12+0)%

QUESTION 2. For the cash flows shown below, determine (a) the future worth in year 6 and (b) the equivalent Annual value for years 0 through 12. (Use gradient and annual equivalent series formulas in calculations) Cash Flow S/yr -50000 Year 0 1-2 3-5 6 7 8 9 10 11-12 6000 6000 5500 6000 6500 7000 7500 8000 Interest ratio Monthly effective interest rate (2+0*0,1)% (7+4)% per year, compounded quarterly Effective interest rate for 24 months (12+0)%

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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