Pl do not paste hand rewritten answer. Pl mention all the formulas used. A machine costs...
Pl do not paste hand rewritten answer. Pl mention all the formulas used.
A machine costs $20000 and has a 5-year useful life. At the end of 5 years, it can be sold for $4000. If the annual interest rate is 8% compounded semiannually, what are the equivalent annual value (AV) and the present value (PV) of the machine?
Homework Answers
Present value = 16000/(1+0.5)5.
= 13150$
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