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ECE4802_Exam_2_Su07_StudyProblems

# ECE4802_Exam_2_Su07_StudyProblems - ECE 4802A Project...

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ECE 4802A -- Project Engineering and Professional Practice EXAM #2 Study Problems Summer 2007 Page 1 of 27 1. Time Value of Money

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ECE 4802A -- Project Engineering and Professional Practice EXAM #2 Study Problems Summer 2007 Page 2 of 27 1. Time Value of Money (Solution)
ECE 4802A -- Project Engineering and Professional Practice EXAM #2 Study Problems Summer 2007 Page 3 of 27 2. Time Value of Money Consider the payment schedule shown below? All payments are made at the end of the year in which they are listed. Assume an interest rate of 8 percent. A. What is the present value of this series of payments, i.e., at the beginning of year 1? Year Payment Amount(\$) 1 1,250 2 5,000 3 1,250 4 1,250 5 1,250 6 1,250 7 1,250 8 10,000 9 7,500 B. What is the future value at the end of year 9 for all of the 9 payments made to that date?

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ECE 4802A -- Project Engineering and Professional Practice EXAM #2 Study Problems Summer 2007 Page 4 of 27 2. Time Value of Money (Solution)