An engineer has been offered an investment opportunity that will require an immediate cash outlay of $40,000 for a cash inflow of $3500 for each year of investment. However, she must state now the number of years she plans to retain the investment. Additionally, if the investment is retained for 6 years, a lump-sum amount of $39,000 will be returned to her, after 10 years, the lump-sum return is anticipated to be $50,500, and after 15 years, it is estimated to be $56,000. Money is currently worth 9% per year. Determine the present worth values for 6 years, 10 years, and 15 years, and decide if the decision is sensitive to the retention period? The present worth when the investment is retained for 6 years is $[ The present worth when the investment is retained for 10 years is $[ The present worth when the investment is retained for 15 years is $ The present worth is [(Click to select) to the investment period.

An engineer has been offered an investment opportunity that will require an immediate cash outlay of $40,000 for a cash inflow of $3500 for each year of investment. However, she must state now the number of years she plans to retain the investment. Additionally, if the investment is retained for 6 years, a lump-sum amount of $39,000 will be returned to her, after 10 years, the lump-sum return is anticipated to be $50,500, and after 15 years, it is estimated to be $56,000. Money is currently worth 9% per year. Determine the present worth values for 6 years, 10 years, and 15 years, and decide if the decision is sensitive to the retention period? The present worth when the investment is retained for 6 years is $[ The present worth when the investment is retained for 10 years is $[ The present worth when the investment is retained for 15 years is $ The present worth is [(Click to select) to the investment period.

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 22P

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