Basics Of Engineering Economy
2nd Edition
ISBN: 9780073376356
Author: Leland Blank, Anthony Tarquin
Publisher: MCGRAW-HILL HIGHER EDUCATION
expand_more
expand_more
format_list_bulleted
Question
Chapter 1, Problem 39P
a.
To determine
The simple interest of the company.
b.
To determine
The compound interest of the company.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Badger Pump Company invested $500,000 five years ago in a new product line that is now worth $900,000. What rate of return did the company earn on a compounded interest basis? The answer should be to four significant figures.
Your grandmother deposited $10,000 in an investment account on the day you were born to help pay the tuition when you go to college. If the account was worth $50,000 seventeen years after she made the deposit, what was the rate of return on the account?
How much interest is payable each year on a loan of $2,000 if the interest rate is 10% per year when half of the loan principal will be repaid as a lump sum at the end of four years and the other half will be repaid in one lump-sum amount at the end of eight years? How much interest will be paid over the eight-year period?
Chapter 1 Solutions
Basics Of Engineering Economy
Ch. 1 - Prob. 1PCh. 1 - Which of the following would be considered...Ch. 1 - Prob. 3PCh. 1 - Prob. 4PCh. 1 - Prob. 5PCh. 1 - Prob. 6PCh. 1 - Prob. 7PCh. 1 - Prob. 8PCh. 1 - Prob. 9PCh. 1 - What is meant by the term time value of money?
Ch. 1 - Prob. 11PCh. 1 - Of the fundamental dimensions length, mass, time,...Ch. 1 - Prob. 13PCh. 1 - When an interest rate statement does not include a...Ch. 1 - Prob. 15PCh. 1 - Prob. 16PCh. 1 - Prob. 17PCh. 1 - Prob. 18PCh. 1 - Prob. 19PCh. 1 - Prob. 20PCh. 1 - Prob. 21PCh. 1 - Prob. 22PCh. 1 - Prob. 23PCh. 1 - Prob. 24PCh. 1 - Prob. 25PCh. 1 - Prob. 26PCh. 1 - Prob. 27PCh. 1 - Prob. 28PCh. 1 - How many years does it take for an investment of...Ch. 1 - Prob. 30PCh. 1 - Prob. 31PCh. 1 - Prob. 32PCh. 1 - Prob. 33PCh. 1 - Prob. 34PCh. 1 - Prob. 35PCh. 1 - Prob. 36PCh. 1 - Prob. 37PCh. 1 - Prob. 38PCh. 1 - Prob. 39PCh. 1 - Prob. 40PCh. 1 - Prob. 41PCh. 1 - Prob. 42PCh. 1 - Prob. 43PCh. 1 - Prob. 44PCh. 1 - At 9% per year simple interest, 1000 is equivalent...Ch. 1 - Prob. 46PCh. 1 - Prob. 47PCh. 1 - Prob. 48PCh. 1 - Prob. 49PCh. 1 - Prob. 50PCh. 1 - Prob. 51PCh. 1 - Prob. 52PCh. 1 - Prob. 53PCh. 1 - Prob. 54PCh. 1 - Prob. 55PCh. 1 - Prob. 56PCh. 1 - Prob. 57PCh. 1 - Prob. 58PCh. 1 - Prob. 59PCh. 1 - Prob. 60PCh. 1 - Prob. 61PCh. 1 - Prob. 62PCh. 1 - Prob. 63PCh. 1 - Prob. 64PCh. 1 - Prob. 65PCh. 1 - Prob. 66PCh. 1 - Prob. 67PCh. 1 - Prob. 69APQCh. 1 - Prob. 70APQCh. 1 - Prob. 71APQCh. 1 - Prob. 72APQCh. 1 - An investment of 8,000 nine years ago has...Ch. 1 - Prob. 74APQCh. 1 - Prob. 75APQCh. 1 - Prob. 76APQCh. 1 - Prob. 77APQ
Knowledge Booster
Similar questions
- A company borrowed $120,000 at an interest rate of 9% to be repaid over a period of six years. The loan will be repaid in installments according to the cash-flow diagram shown herewith (which also reflects the cash inflow of $120,000). What is the size of the last payment (X) required to pay off the loan?arrow_forwardHow much will a person get when redeeming a bond worth $1,200,000.00 today that will mature in three months if the bank charges a compound fee of 4% per month?arrow_forwardThe only time you change the original cash flow diagram in problems involving uniform series cash flows is when the: (a) payment period is longer than the compounding period (b) payment period is equal to the compounding period (c) payment period is shorter than the compounding period (d) stated interest rate is a nominal interest ratearrow_forward
- What is the true effective annual rate of a credit card plan that charges 1.5% per month on an unpaid balance?arrow_forwardBart is an engineering graduate who did not take Engineering Economics during his undergraduate studies. After working for a year or so, he faced financial problems and borrowed $500 from a friend in the finance department of his office. Bart agreed to pay off the principal plus $75 in interest a month later. The two parted ways at different jobs and a year passed. The friend wrote an email to Bart exactly one year later and asked for payment of the loan plus interest with monthly compounding, since Bart did not make any payments during the year. a) How much does Bart now owe his friend? b) What is the effective b) What is the effective annual rate Bart pays on the $500 loan? Answer: a) $2675.13; b) 435.02%.arrow_forwardParkhill, Smith, and Cooper, a consulting engineering firm, pays a bonus to each engineer at the end of the year based on the company’s profit for that year. If the company’s initial investment was $1.2 million, what rate of return has it made if each engineer’s bonus has been $3000 per year for the past 10 years? Assume the company has six engineers and that the bonus money represents 5% of the company’s profit.arrow_forward
- if interest is compounded at 20% per year, how long will it take for $50,000 to accumulate to $86,400?arrow_forwardYou borrowed $100,000 at 6% per year compounded monthly for 48 months.Which is the number of first month where the outstanding loan balance is less than $40,000?arrow_forwardIf you make quarterly deposits for 24 years (beginning one quarter from now) into an account that compounds interest at 1% per month, the value of n in the F/A factor (for determining F at the end of the 24-year period), isarrow_forward
- 1. A cash flow sequence starts in year 1 at $4000 and decreases by $300 each year through year 9. Determine (a) the value of the gradient G; (b) the amount of cash flow in year 5; and (c) the value of n for the (P%G, i% ,n) factor.arrow_forwardWhat would the return be for a $ 1000 face value coupon bond with a rate of 10% that is bought for $1000, kept for 1 year and then sold for $1200?arrow_forwardIdentify the payment period and compounding period for the following situations:a. Deposits are made each quarter into an account reserved for purchasing new equipment two years from now. The interest rate on the deposits is 12% per year compounded monthly.b. The Williams family takes a $10,000 withdrawal from a second retirement package each 6 months to pay property and income taxes. The funds are invested in a fixed return annuity that pays 7% per year.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Principles of Economics (12th Edition)EconomicsISBN:9780134078779Author:Karl E. Case, Ray C. Fair, Sharon E. OsterPublisher:PEARSON
Engineering Economy (17th Edition)EconomicsISBN:9780134870069Author:William G. Sullivan, Elin M. Wicks, C. Patrick KoellingPublisher:PEARSON
Principles of Economics (MindTap Course List)EconomicsISBN:9781305585126Author:N. Gregory MankiwPublisher:Cengage Learning
Managerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-...EconomicsISBN:9781259290619Author:Michael Baye, Jeff PrincePublisher:McGraw-Hill Education
Principles of Economics (12th Edition)
Economics
ISBN:9780134078779
Author:Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:9780134870069
Author:William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:PEARSON
Principles of Economics (MindTap Course List)
Economics
ISBN:9781305585126
Author:N. Gregory Mankiw
Publisher:Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-...
Economics
ISBN:9781259290619
Author:Michael Baye, Jeff Prince
Publisher:McGraw-Hill Education