Problem 5 A Henry Mueller Supply Co. sells vibration control equipment for wind turbines exposed to harsh environmental factors. Annual cash flows for an 8-year period are shown in the table. Determine the future worth of the cash flows at an interest rate of 9% per year. Hint: What is the relation between future worth and annual worth? Year 1 2 3 4 5 6 7 8 Revenue, 275 275 275 275 275 275 275 275 $1000 Expenses, 60 60 60 60 60 60 60 60 $1000 Solution: B Durban Moving and Storage wants to have enough money available 7 years from now to purchase a new tractor-trailer. If the estimated cost will be $300,000, how much should the company set aside each year if the funds earn 11% per year? Hint: What is the relation between annual worth and future worth? Solution