IE 347 Engineering Econ.

& Cost Analysis-II, Fall 2011, Recitation 1 Chapter 2, Problem 36 For the cash flow shown below, determine the value of G that will make the future worth in year 4 equal to $6000 at an interest rate of 15% per year. Year Cash Flow 0 0 1 $2000 2 2000G 3 20002G 4 20003G

Chapter 2, Problem 42 Hughes Cable Systems plans to offer its employees a salary enhancement package that has revenue sharing as its main component. Specifically, the company will set aside 1% of total sales for year-end bonuses for all its employees. The sales are expected to be $5 million the first year, $6 million the second year, and amounts increasing by 20% each year for the next 5 years. At an interest rate of 10% per year, what is the equivalent annual worth in years 1 through 5 of the bonus package? Chapter 3, Problem 27 Find the value of x below such that the positive cash flows will be exactly equivalent to the negative cash flows, if the interest rate is 14% per year.

Chapter 3, Problem 50 For the cash flow tabulation, calculate the equivalent uniform annual worth in periods 1 through 10, if the interest rate is 10% per year. Year 0 1 2 3 4 5 Amount, $ 2000 2000 2000 2000 2000 2500 Year 6 7 8 9 10 Amount, $ 2400 2300 2200 2100 2000