QUESTION 3 (20 MARKS) A. Figure 3.1 shows a cash flow diagram for an engineering project. The project has an initial investment of RM 100,000 and expenditure of RM 5,000 every three months for 6 years. Az = RM?/ month 3 12 24 25 72 months A1 = RM 5,000/3 months i = 18% per year compounded monthly RM 100,000 Figure 3.1: Cash flow of an engineering project You have been asked to determine the minimum income required for every month starting from the first month in year 3 until the end of year 6 to cover all the project costs. (6 marks) B. A wealthy businessman wants to start a permanent fund for supporting research in UTM directed toward sustainability. The donor plans to give equal amounts of money for each of the next 4 years, plus one now (i.e., five donations) so that RM 120,000 per year can be withdrawn each year forever, beginning in year 5. If the fund earns interest at a rate of 15% per year, how much money must be donated each time? (4 marks) C. Two manufacturers supply Magnetic Resonance Imaging (MRI) systems (Systems A and B) for medical imaging. Sultan Aminah Hospital wishes to replace its current MRI equipment that was purchased 10 years ago with the newer technology and clarity of a state of-the-art system. System A will have a first cost of RM 2,600,000, an operating cost of RM 100,000 per year, and a salvage value of RM 500,000 after its 5-year life. System B will have a first cost of RM 3,100,000, operating costs of RM 80,000 and RM 90,000 the first and the second year with an expected increase of RM 5,000 per year thereafter. No salvage value after its 10-year life. Evaluate which system should be selected on the basis of a future worth analysis at an interest rate of 10% per year? Draw cash flow diagrams for each system and show all the calculations. (10 marks)