Problem 2 (30 pts) Find the present worth of cash flows in the following diagram assuming a yearly interest rate of i-10% per year until and including year 18 and i=12% per year thereafter. Note: Be careful about the timings of the cash flows. 1000$ and 2000 withdrawals are made in every two years and 3000$ deposits are made in every 4 years. 2000 1000 4 13 15 17 19 21 23 0 1 3 5 7 9 11 3000 Mot Kaynakl dosyalar virs ierebilir. Dzenlemeniz gerekmiyorsa, Korumal Grnmde kalman daha gvenli olur. Yardim Dzenleme Problem 3 (30pts) Suppose that you borrow a loan of amount P from a bank at the end of month 3 and make the monthly deposits to the bank as in the cash flow diagram below. In the following cash flow diagram A-As-Ag-1000, and starting with A10, deposits start decreasing in the amount of 40. However, due to a cash problem, you miss a payment at month 12 but continue with your original payment plan thereafter that is, A10-960, A1-920, A12-0, Au-840 etc). With these payments, your dept to the bank will be 0 at the end of month 10. Assuming that the interest rate is 12% compounded monthly. Missing payment P I months 3 5 7 9 10 11 12 13 ........ 00 Consider an investment that requires the purchase of a machine at a price of $10.000. You plan to use this machine for the production of a certain product. The operating costs are expected to be $1000 per month. With this machine, you expect to produce and sell 100 units of a certain product per month at the price of $20 per unit. You also plan to increase the selling price of your product by 10 % at the beginning of every year. You plan to continue the production for next 30 years, however, the life of the machine is expected to be 5 years. Thus, in every 5 years you need to renew the machine. Assume that the cost of the machine increases by S5000 in every 5 years. (Thus, the cost of machine will be $15000 a year 5, $20000 at year 10 etc.) Assuming that the market interest rate is 20% compounded quarterly, write an equation that calculated the net present worth of this investment. Go Ayo Das Problem 2 (30 pts) Find the present worth of cash flows in the following diagram assuming a yearly interest rate of i-10% per year until and including year 18 and i=12% per year thereafter. Note: Be careful about the timings of the cash flows. 1000$ and 2000 withdrawals are made in every two years and 3000$ deposits are made in every 4 years. 2000 1000 4 13 15 17 19 21 23 0 1 3 5 7 9 11 3000 Mot Kaynakl dosyalar virs ierebilir. Dzenlemeniz gerekmiyorsa, Korumal Grnmde kalman daha gvenli olur. Yardim Dzenleme Problem 3 (30pts) Suppose that you borrow a loan of amount P from a bank at the end of month 3 and make the monthly deposits to the bank as in the cash flow diagram below. In the following cash flow diagram A-As-Ag-1000, and starting with A10, deposits start decreasing in the amount of 40. However, due to a cash problem, you miss a payment at month 12 but continue with your original payment plan thereafter that is, A10-960, A1-920, A12-0, Au-840 etc). With these payments, your dept to the bank will be 0 at the end of month 10. Assuming that the interest rate is 12% compounded monthly. Missing payment P I months 3 5 7 9 10 11 12 13 ........ 00 Consider an investment that requires the purchase of a machine at a price of $10.000. You plan to use this machine for the production of a certain product. The operating costs are expected to be $1000 per month. With this machine, you expect to produce and sell 100 units of a certain product per month at the price of $20 per unit. You also plan to increase the selling price of your product by 10 % at the beginning of every year. You plan to continue the production for next 30 years, however, the life of the machine is expected to be 5 years. Thus, in every 5 years you need to renew the machine. Assume that the cost of the machine increases by S5000 in every 5 years. (Thus, the cost of machine will be $15000 a year 5, $20000 at year 10 etc.) Assuming that the market interest rate is 20% compounded quarterly, write an equation that calculated the net present worth of this investment. Go Ayo Das
