Principles of Engineering Economic Analysis
Principles of Engineering Economic Analysis
6th Edition
ISBN: 9781118163832
Author: John A. White, Kenneth E. Case, David B. Pratt
Publisher: Wiley, John & Sons, Incorporated
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Chapter 2, Problem 1PS
To determine

Calculate the future value.

Expert Solution & Answer
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Explanation of Solution

Time period is denote by n and interest rate is denoted by i. Future value (FV) can be calculated as follows.

FV=Present(1+i)n=2,750(1+0.05)5=3,509.77

The future value is $3,509.77. Since the amount receive after 5 year is less than the future value, the person would prefer to receive now. Thus, the given statement is true.

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Chapter 2 Solutions

Principles of Engineering Economic Analysis

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