Unformatted text preview: APPENDIX E
Hirschmann-Brauweiler Tables The Hirschmann-Brauweiler Tables may be used for discounting or compounding cash flows, although the tables indicate discounting. These tables are divided into three sections depending upon how the cash flows: instantaneously, uniformly, or years digits. The last section was originally developed when sumof-years depreciation was allowable. It is still used for cash flows declining to zero uniformly over a time period. The factors are used to discount cash flows back to time zero continuously. To enter the tables, an argument R T must first be calculated, where R is the interest rate expressed as a whole number and T is the time in years. For example, if a cash flow of $1000 occurs uniformly over a 2-year period at 15% interest, the discounted cash flow is calculated as follows: Enter the uniform table with the argument of R T 15 2 3 and the factor is 0.8639. Therefore the discounted cash flow is $1000 0:8639 $863:90: These tables may also be used for compounding as mentioned previously. In this case, the factor used is the reciprocal of R T from the compounding table. For example, the factor for a cash flow that occurs instantaneously 2 years prior to time zero at 20% interest is R T from the instantaneous table, or 20 2 40: From that table, the factor is 0.6703. But since the cash flow occurs 2 years prior to time zero, the reciprocal of the factor is 1=0:6703 1:4919: For example, a cash flow of $5000 that occurs instantaneously 2 years prior to time zero at 20% interest is $5000 1=0:6703 $7459:35; which is the compound amount of that cash flow. In using the table, one must select the correct cash flow model. TM Copyright 2003 by Marcel Dekker, Inc. All Rights Reserved. TM Copyright 2003 by Marcel Dekker, Inc. All Rights Reserved. TM Copyright 2003 by Marcel Dekker, Inc. All Rights Reserved. TM Copyright 2003 by Marcel Dekker, Inc. All Rights Reserved. ...
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- Spring '08