Question

- Find the Cash Flow PW using 10% interest rate for the following:

1)

years	$ cost
0	2,975
1	-
2	-
3	3,000.00
4	3,100.00
5	3,200.00
6	3,300.00
7	3,400.00
8	3,500.00

2)

years	$ cost
0	2,975
1	-
2	-
3	3,000.00
4	3,100.00
5	3,200.00
6	3,300.00
7	3,400.00
8	3,500.00

Answer 1

Answer = Present Worth = $14573.51175 or $14573.51

Exaplaination -

Present worth has arrived by multiplying the cost to be incurred in respective years with that year's discounting factor, and the sum of all the yearly present values gives us total present worth of all the costs.