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For all questions, show your calculations in terms of the equivalence equations using (P/A,i,n), (F/P,i,n), etc. (where appropriate), and then substitute the numerical values to
For all questions, show your calculations in terms of the equivalence equations using (P/A,i,n), (F/P,i,n), etc. (where appropriate), and then substitute the numerical values to find the final answers. Charts for rate of return factors i=0.01, i=0.04, i=0.0406, i=0.12, i=0.1268, are at the back of the exam. Put a box around your final answers. 5. (20 pts) You are given an opportunity to invest in a scheme that will pay you 3 end-of-period cash flows at the end of years 3, 4, 5 and another three cash flows at the end of years 8, 9, 10. You require 12% APR compounded monthly as your MARR. What is the most you are willing to pay for this opportunity? 5.1. (7 pts) Show your cash flow diagram from your standpoint. 5.2. (8 pts) Show your equivalence equation in terms of equivalence factors that will solve this problem. 5.3. (5 pts) Find the most you are willing to pay for this opportunity by filling in the factor values and solving for you purchase amount. For all questions, show your calculations in terms of the equivalence equations using (P/A,i,n), (F/P,i,n), etc. (where appropriate), and then substitute the numerical values to find the final answers. Charts for rate of return factors i=0.01, i=0.04, i=0.0406, i=0.12, i=0.1268, are at the back of the exam. Put a box around your final answers. 5. (20 pts) You are given an opportunity to invest in a scheme that will pay you 3 end-of-period cash flows at the end of years 3, 4, 5 and another three cash flows at the end of years 8, 9, 10. You require 12% APR compounded monthly as your MARR. What is the most you are willing to pay for this opportunity? 5.1. (7 pts) Show your cash flow diagram from your standpoint. 5.2. (8 pts) Show your equivalence equation in terms of equivalence factors that will solve this problem. 5.3. (5 pts) Find the most you are willing to pay for this opportunity by filling in the factor values and solving for you purchase amount
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