This preview shows pages 1–3. Sign up to view the full content.
Carleton University
Department of Civil and Environmental Engineering
Engineering Economics (ECOR 3800A)
ASSIGNMENT # 1
Issued OCT 9, 2010 Due Date
: OCT 22, 2010 at 12:00 Noon
Drop off your location: Filing cabinet near the entrance to the Civil and Environmental
Engineering office.
The cabinet located to the right of room 3424 ME.
===============================================================
(Q1/a)
To withdraw the following $1000 payment series, determine the minimum deposit (P)
you should make now if your deposits earn an interest rate of 10%, compounded
annually. Note that you are making another deposit at the end of year 7 in the amount of
$500.Which the minimum deposit P, your balance at the end of year 10 should be zero.
(Q1/b)
How much do you need to invest in equal annual amounts for the next 10 years if you
want to withdraw $5000 at the end of the eleventh year and increase the annual
withdrawal by $1000 each year thereafter until year 25? The interest rate is 6%,
compounded annually.
(Q1/C)
Ming wants to retire as soon as she has enough money invested in a special bank account
(paying 14% interest, compounded annually) to provide her with an annual income of
$25000. She is able to save $10000 per year, and the account now holds $5000. If she just
turned 20, and expects to die in 50 years, how old will she be when she retires?
There
should be no money left when she turns 70.
(Q1/d)
Compute the present worth for the cash flow diagram below. Assume
i
= 10%
End of period
Deposit
withdrawal
0
P
1 – 6
1000
7
500
8 – 10
1000
0
1
2
3
4
5
6
7
100 100
150 150
200
200
250
250
P
This preview has intentionally blurred sections. Sign up to view the full version.
View Full Document(Q2/a)
What is the future worth of a series of equal yearend deposits of $1200 for 10 years in a
saving account that earns 9%, annual interest, if
a)
All deposits were made at the end of each year?
b)
This is the end of the preview. Sign up
to
access the rest of the document.
 Spring '10
 Forgot
 Environmental Engineering

Click to edit the document details