I want answer this question step by step.
Question #1:
Consider the cash flow diagram below. Determine the present- worth, annual-worth, and future -worth, that is equivalent to all of the cash flows shown, assuming an annual interest rate of 10%.
i = 10% per year
Question #2:
Determine the present worth of a geometric gradient series with a cash flow of $50,000 in year 1, and an increase of 6% each year after through year 8, assuming an annual interest rate of 10%.
Question #3:
A new bridge is expected to be permanent and will have an initial construction cost of $30 million. Its recurring (repeated until infinity) inspection & operating costs are estimated to be $50,000 per year. The bridge must be also rehabilitated at a recurring cost of $1 million every 5 years. What is its capitalized cost, assuming an interest rate of 10% per year?
Question #4:
ABC-Chemicals is considering investing in a new equipment that will reduce its product shipping Cost. If the new equipment will cost $220,000 to he purchased and installed, how much the company should save each year for the next
3 years, in order to justify this investment, assuming an annual interest rate of 10%?
Question #5:
Consider the cash flows shown below. Assuming an annual interest rate of 8%,
a. Draw the cash flow diagram for each alternative.
b. Using the present worth analysis, identify the best alternative.
c. Confirm the best alternative using annual worth analysis.
|
P |
Q |
| First cost |
23000 |
30000 |
| Annual operating cost, $per year |
4000 |
2500 |
| salvage value |
3000 |
1000 |
| Life years |
3 |
6 |