Homework Answers
Solution:-
PW of equipment in case a) (When Inflation is not considered)
= -1,43,000 – 56,000 (P/A,18%,5) + 28600 / (1.18)^5
=-143000-56000(3.127) + 28600 / 2.2878
=-143000 – 175,112 + 12501
= -305,611
PW of equipment in case b) (When Inflation is considered)
= -1, 43,000 – 56,000 (P/A, 12%, 5) + 28600 / (1.12)^5
=-143000-56000(3.605) + 28600 / 1.7623
=-143000 – 201,880 + 16229
= -328651
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