Engineering Economy
8th Edition
ISBN: 9780073523439
Author: Leland T Blank Professor Emeritus, Anthony Tarquin
Publisher: McGraw-Hill Education
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Question
Chapter 2, Problem 27P
(1):
To determine
Calculate value factor to the present value.
(1):
Expert Solution
Explanation of Solution
Option (a):
Interest rate (i) is 18% and time period (n) is 33.
The
The future value factor to the present value is 244.545.
Option (b):
The future value factor to the present value (FP) through formula can be calculated as follows:
The future value factor to the present value is 235.5625.
(2):
To determine
Calculate annual growth rate.
(2):
Expert Solution
Explanation of Solution
Option (a):
Interest rate (i) is 12% and time period (n) is 54.
The annual growth rate value (AG) through linear interpolate can be calculated as follows. The interest rate lies between (i1) 11% and (i2) 13%.
The annual growth factor value is 8.3356.
Option (b):
The annual growth factor value (AG) through formula can be calculated as follows:
The annual growth factor value is 8.2143.
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Chapter 2 Solutions
Engineering Economy
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