Assignment 2
2.7 Calculate the present worth of 10 uniform payments of $8000 that begin 1 year from now at
an interest rate of 10% per year
2.9 Determine the size of your investment account 30 years from now (when you plan to reDre)
if you deposit $12,000 each year, beginning 1 year from now, and the account earns interest
at a rate of 10% per year
2.11 Thompson Mechanical Products is planning to set aside $150,000 now for possible
replacement of large synchronous refiner motors when it becomes necessary. If the
replacement isn’t needed for 5 years, how much will the company have in its investment
set-aside account? Assume a rate of return of 18% per year
2.30 An arithmeDc cash flow gradient series equals $500 in year 1, $600 in year 2, and amounts
increasing by $100 per year through year 9. At i = 10% per year, determine the present
worth of the cash flow series in year 0.
2.34 A low-cost noncontact temperature measuring tool may be able to idenDfy railroad car
wheels that are in need of repair long before a costly structural failure occurs. If the BNF
railroad saves $100,000 in year 1, $110,000 in year 2, and amounts increase by $10,000
each year for 5 years, what is the future worth of the savings in year 5 at an interest rate of
10% per year?
2.43 A civil engineer planning for her reDrement places 10% of her salary each year into a high-
technology stock fund. If her salary this year (end of year 1) is $160,000 and she expects
her salary to increase by 3% each year, what will be the future worth of her reDrement fund
a\er 15 years provided it earns 7% per year?
