Determine the present worth in year of the costs

Determine the present worth in year of the costs

Determine the present worth in year of the costs

Microeconomics
1. Calculate the annual worth (years 1 through 7) of Merchant Trucking
Company’s cash flow. Use an interest rate of 10% per year.
Year 0 1 2 3 4 5 6 7 Cash Flow, $ millions 450 -40 200 200 200 200 200 200.

2. The by-product department of Iowa Packing utilizes a cooker that has the
cost stream shown. Determine the present worth in year 0 of the costs at an
interest rate of 10% per year.

Year Cost ($1000)

0 850

1 300

2 400

3 400

4 400

5 500

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