A civil engineer starts investing his money when he graduates from college. He is able to afford investing $10,000 a year from the time he graduates in four years until the end of eight years. He also plans to increase his investment an additional $2,500 per year increasing by $2,500 every year until year eight. Use the interest rate 10%. a. draw the cash flow diagrams for the above cash flows b. how much will the civil engineer have saved by the end of year eight c. what is its present worth on the year he started college
A civil engineer starts investing his money when he graduates from college. He is able to afford investing $10,000 a year from the time he graduates in four years until the end of eight years. He also plans to increase his investment an additional $2,500 per year increasing by $2,500 every year until year eight. Use the interest rate 10%. a. draw the cash flow diagrams for the above cash flows b. how much will the civil engineer have saved by the end of year eight c. what is its present worth on the year he started college
Chapter14: Multinational Capital Budgeting
Section: Chapter Questions
Problem 1IEE
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A civil engineer starts investing his money when he graduates from college. He is able to afford investing $10,000 a year from the time he graduates in four years until the end of eight years. He also plans to increase his investment an additional $2,500 per year increasing by $2,500 every year until year eight. Use the interest rate 10%.
a. draw the cash flow diagrams for the above cash flows
b. how much will the civil engineer have saved by the end of year eight
c. what is its present worth on the year he started college
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