Answered: The End of Years cash flow are expected…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Subject: Engineerings Economics
Topics:
1. Uniform Arithmetic Gradient

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Question:
The End of Years cash flow are expected to be P10,000 for second year, P20,000 for the third year, and P30,000 for the fourth year. If interest is 18% per year, find the present equivalent value P at the beginning of the first year.

PLEASE FOLLOW THE FORMULA BELOW AND MAKE SURE TO USE REFERENCES PLEASE

Uniform Arithmetic Gradient
As n increases without limit (n→ ∞)
A =
P =
G
i²
and

Uniform Arithmetic Gradient
A = G(A/G, i%, n)
n
A = G | ₁2 ₁ (1 + i)n
P = G(P/G, i%, n)
G[1 (1 + i)-n
G[¹4
i
P =
-
F = G(F/G, i%, n)
G[(1 + i)"
1
i
i
F =
-
-
- n
n
(1 + i)n

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