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At the beginning of her freshman year, Nicole decided to start a small business in her apartment. She bought a small all-purpose copy machine for
At the beginning of her freshman year, Nicole decided to start a small business in her apartment. She bought a small all-purpose copy machine for $3,000. With the help of her roommates, she got two projects. Project I will pay her $3,000 in year 1 and project 2 will pay $5,000 in year 2. She will not do any project in year three but rather do a routine equipment maintenance of $600. She plans to sell the machine after the routine maintenance at the end of year 4 for its salvage value of $500. Using an interest rate of 10%: i. Draw the cash flow diagram (CFD) for Nicole's business Write the equation to calculate the Future worth of the cash flow using ONLY the Compound interest tables formula using the format: T = W(X/H, I, n). iii. Calculate the Future worth
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