Question 2 9.12 For the cashflows in Problem 9.11, the function for evaluating t

Question

Question 2

9.12 For the cashflows in Problem 9.11, the function for evaluating the ROR is

Answer a.

-500 - 50(P/F, i, 4) + 400(P/F, i, 3) + 300 (P/F, i, 5) = 0

b.

-500 - 50(P/F, i, 2) + 400(P/F, i, 1) + 300 (P/F, i, 3) = 0

c.

500 - 50(P/F, i, 4) + 400(P/F, i, 3) + 300 (P/F, i, 5) = 0

d.

None of the above.

Answer a.

-500 - 50(P/F, i, 4) + 400(P/F, i, 3) + 300 (P/F, i, 5) = 0

b.

-500 - 50(P/F, i, 2) + 400(P/F, i, 1) + 300 (P/F, i, 3) = 0

c.

500 - 50(P/F, i, 4) + 400(P/F, i, 3) + 300 (P/F, i, 5) = 0

d.

None of the above.

Explanation / Answer

Answer: a). -500 - 50(P/F, i, 4) + 400(P/F, i, 3) + 300 (P/F, i, 5) = 0

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