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Example 2: EngineersatseaWoridmodifiedanexistingboat.Themodificationscosts$8000anditisexpectedtolast6yearswithasalvagevalue$1300.Themaintenancecostisexpectedtobe$1700thefirstyearandincreasingby11%peryearthereafter.Determinetheequivalentpresentworthat8%annualinterestrate.Johncanmakeinvestmentof$3000nowinordertoreceive$5000fiveyearsfromnow.-Determinetherateofreturncertificateofdeposite,whichinvestmentshouldhemake?

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Example 2: EngineersatseaWoridmodifiedanexistingboat.Themodificationscosts$8000anditisexpectedtolast6yearswithasalvagevalue$1300.Themaintenancecostisexpectedtobe$1700thefirstyearandincreasingby11%peryearthereafter.Determinetheequivalentpresentworthat8%annualinterestrate.Johncanmakeinvestmentof$3000nowinordertoreceive$5000fiveyearsfromnow.-Determinetherateofreturncertificateofdeposite,whichinvestmentshouldhemake?

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