present worth of income from an investment that follows an a

present worth of income from an investment that follows an arithmetic gradient is projected to be $475,000. The income in year one is expected to be $25,000. What is the gradient each year through year 6 at an interest rate of 10% per year? 3. The 4. Calculate the future worth in year 7 of Merchant Trucking Company\'s cash flows. Using an interest rate of 10% per year. Year 4 Cash flow, Smillion 45040 200 200 200 200 200200

Solution

(3)

475,000 = 25,000(P/A,10%,6) + G(P/G,10%,6)

475,000 = 25,000(4.3553) + G(9.6842)

9.6842G = 366,117.50

G = $37,805.65