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4) The net cash flow associated with development and sale of a new product is shown. Determine the present worth at an interest rate
4) The net cash flow associated with development and sale of a new product is shown. Determine the present worth at an interest rate of 12% per year. The cash flow is in $1000 units. Year Cash 1 2 3 4 5 6 7 8 9 Flow, $ -120-100-40 +50 +50 +80 +80 +80 +80 Poso -P350 Po120 -120 -100 P0100 40 80 P040 50 5 67 8 9 (a) Draw the cash flow (b) P5(80): 80(P/A, 4y, i) (c) P3(50): 50(P/A, 2y, i) (d) P0(80): (b)*(P/F, 5y, i) (e) P0(50): C(p/F, 3y. i)
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