Draw the cash flow diagram

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Reference no: EM13832569

1a. Lee Inc, is considering a robot that will cost $6,000 to purchace. At the end of it 9 year life, it salvage value will be $1,000. The robot will need to overhauled in year 5 at a cost of $3,000. O&M costs per year will be $1,000. The robot will generate additional income of $2.000 per year from increased productivity. Draw the cash flow diagram.

$5000

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$3000

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-$1000

-$2000

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-$6000

0 1 2 3 4 5 6 7 8 9 10

year

1b. What sum of money received now is equivalent to $150, 000 received at the end of six years from now if the current interest rate is annually 3.5% compounded every half year period?

1c. A company deposits $3,000 in a bank now, how much would be the account at the end of 10 years if the bank pays 8% interest compound annually?

1d. A company deposits $3,000 in a bank at the end of every year for 20 years. if the bank pays 8% interest, how much would be in the account at the end of years?

1e. You borrow $5,000 from a bank on January 1st. You must repay the loan in equal monthly payments, due on the 1st of each month beginning February 1st. if interest is % annually compounded monthly, what will be your equal monthly payments?

1f. The market for a product is expected to increase at an annual rate of 8%. First-year sales are estimated at $60,000, the horizon is 15 years, and the interest rate is 10%. What is the present value?

1g. It is estimated that the maintenance cost on a used car will be $400 the first year. Each subsequent year, the maintenance cost will increase by $100. At an interest rate of 5.0% per year, what is the equivalent equal uniform annual cost of maintaining the car for its 10 year life?

Reference no: EM13832569

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