1) You spend $3000 and in return receive three payments of $2400 - at the end of 2nd, 4th, and 6h year. What is the PW of this investment? (interest rate is 10%yr, compounded semi-annually) a) 19...

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1) You spend $3000 and in return receive three payments of $2400 - at the end of 2nd, 4th, and 6h year. What is the PW of thi

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Answer 1

Answer #1

IF YOU HAVE ANY DOUBTS COMMENT BELOW I WILL BE TTHERE TO HELP YOU..ALL THE BEST..

AS FOR GIVEN DATA...

Cash Flow at Year 0 = -$3,000
Cash Flow at Year 2 = $2,400
Cash Flow at Year 4 = $2,400
Cash Flow at Year 6 = $2,400

Annual Rate of Interest (r) = 10% or 5% semi-annually

Present worth = -$3,000 + $2,400 / (1 + 0.05)^4 + $2,400 / (1 + 0.05)^8 + $2,400 / (1 + 0.05)^12
Present worth = - $3,000 + $1,975 + $1,624 + $1,336
Present worth = $1,935

HOPE IT HELPS YOU

RATE THUMBSUP IT HELPS ME ALOT

THANKS

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Add Answer to: 1) You spend $3000 and in return receive three payments of $2400 - at the end of 2nd, 4th, and 6h year. What is the PW of this investment? (interest rate is 10%yr, compounded semi-annually) a) 19...

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1) You spend $3000 and in return receive three payments of $2400 - at the end of 2nd, 4th, and 6h year. What is the PW of this investment? (interest rate is 10%yr, compounded semi-annually) a) 19...