Assignment No$.3$

A contracting company purchased a a single unit truck $$15,000$ now and annual payments of

$$600$ per year for $5$ years starting $2$ years from now for annual upgrade.

a$.$ What is the present worth of the payments if the interest rate is $8\%$ per year?

b$.$ What is the future worth of the payments if the interest rate is $8\%$ per year?

c$.$ What is the equivalent annual payment if the interest rate is $8\%$ per year?

An engineer has tracked the average inspection cost for $15$ years. The cost average was steady at

$$900$ for the first four years but have increased consistently by $$100$ for each of the last $11$ years.

Interest rate is $7\%.$

a$.$ What is the total present worth $($in year $0)?$

b$.$ What is the total future worth $($in year $15)?$

You bought a car. You paid $$20,000$ as an initial payment. At the end of the third year, you paid

another payment of $$2,000.$ The remaining amount of car's price is to be paid at the end of $10$

year. Knowing that the price of car is $$32,000,$ find the amount after $10$ years for the cash flow

diagram if the interest rate is $12\%$ per year.

a$.$ Compounded annually.

b$.$ Compounded semiannually.

c$.$ Compounded monthly.