Homework Answers
The answer is calculated as Follows:-
|
Year |
Cash Flow |
PV @ 8% |
|
0 |
-45,000 |
-45,000 |
|
1 |
15,000 |
13,889 {15,000/1.08} |
|
2 |
15,000 |
12,860 {15,000/(1.08)2} |
|
3 |
15,000 |
11,907 {15,000/(1.08)3} |
|
4 |
15,000 |
11,025 {15,000/(1.08)4} |
|
5 |
15,000 |
10,209 {15,000/(1.08)5} |
|
Salvage value- 5 |
5,000 |
3,403 {5,000/(1.08)5} |
|
Total |
18,293 |
So, answer is 18,300. It is approximated to round figure.
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