X=6

30 Wells Fargo Bank lent a newly graduated engineer $1,000 at i = 5 % per year for 4 years to buy home office equipment. From the bank's perspective (the lender), the investment in this young engineer is expected to produce an equivalent net cash flow of $ 282.01 for each of 4 years. This represents a 5 % per year rate of return on the bank's unrecovered balance. Compute the amount of the unrecovered investment for each of the 4 years using the rate of return, ROR, on: a. the unrecovered balance (the correct basis)