i=2% Inflow (+) Outflow (-) 1 P=? 5,000 2 3 5,000 X 4 5 6 t in years Note the cash flow series in the graph. The amounts of 5,000 at years 2 and 4 and X are inflows to our savings account (assume X is equal to $8000), after making an investment of P at the end of year 0. The interest rate is compounded, and each time unit is one year. Assume the entire investment is recovered at the end of year 6.

i=2% Inflow (+) Outflow (-) 1 P=? 5,000 2 3 5,000 X 4 5 6 t in years Note the cash flow series in the graph. The amounts of 5,000 at years 2 and 4 and X are inflows to our savings account (assume X is equal to $8000), after making an investment of P at the end of year 0. The interest rate is compounded, and each time unit is one year. Assume the entire investment is recovered at the end of year 6.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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include cashflow diagram for this