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Given the cash flow diagram below, determine the value of P using an interest rate of 8%.

Year

0

1

2

3

4

5

Cash Flow, $

P

-1,000

-2,000

-3,000

-4,000

1,000

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Keith Leannon
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27 Feb 2018

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Related questions

  1. Given two alternatives:

    Data

    A

    B

    First Cost

    $4,000

    $6,000

    Annual Cost

    $1,000

    $500

    Annual Benefit

    $2,000

    $2,200

    Life, Years

    4

    10

    Salvage Value

    $3,000

    $1,000

    Assuming hat alternatives are replaced at the end of their useful life, determine the better alternative using annual cash flow analysis at an interest rate of 10%.

    A.

    Alternative A, $786
    B.

    Alternative B, $786
    C.

    Alternative A, $384
    D.

    Alternative B, $384

What is the present worth (that is, the equivalent value of the cash flows at year 0) of the cash flows in the table below? Use an interest rate of 6% compounded annually. Year 1 2 3 4 5 6-20 Cash flow 6,000 5,000 4,000 3,000 2,000 10,000 $85,496 $89,263 $89,916 $91,611

1 Two sets of cash flows are shown in the table below. If these sets are equal at 8% interest rate, determine the unknown value, X.

Year 0 1 2 3 4 5
Cash Flow, Series I $125 $100 $75 $50 $25 $0
Cash Flow, Series II $X $2X $3X $4X $5X $7X

2 A deposit of $10,000 now at a interest rate of 10% per year will accumulate in 20 years to an amount equal to _______________.

A.

$54,600
B.

$61,500
C.

$67,280
D.

$51,900

3 Which of the following relationships between compound interest factors is not correct?

A.

Single Payment Compound Amount Factor and Single Payment Present Worth Factor are reciprocals.
B.

Sinking Fund Factor and Uniform Series Compound Amount Factor are reciprocals.
C.

Capital Recovery Factor and the Sinking Fund Factor are reciprocals.
D.

Capital Recovery Factor and Uniform Series Present Worth Factor are reciprocals.

4 What is the present worth of a series of ten deposits of $200 per year at 6% made at the end of each year?

A.

$1,672
B.

$1,072
C.

$1,272
D.

$1,472

5 Determine the net present worth (NPW) of the following cash flows using an interest rate of 7%.

Year

0

1

2

3

4

5

6

7

8

Cash Flow,$

-12,000

2,000

2,000

2,000

2,000

2,000

2,500

3,000

3,500

A.$2,771.05

B.$2,500
C.$1,500
D.$1,771.05

6 At Kal Tech Manufacturing Inc, the time required to make the first unit of an engineered product is 64.1 minutes. Determine the time required for 16th unit if the learning curve percentage is 90%.

A.

42.1 minutes
B.

29.53 minutes
C.

36.45 minutes
D.

20.89 minutes

7 A sum of $994.62 deposited at time

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