Interested to Buy Any Domain ? << Click Here >> for more details...
ACCOUNTING AND FINANCIAL ENGINEERING - EXAMPLE 34.8 : Cash flow agreement where the sign + or - of the amounts are start negative and at a point switch to positive and stay positive is referred to has an investment. The cash flow could be denoted by the symbol of [a, b, c ...]. Consider the following two cases in a biochemical factory : (a) You pay $1 today. You receive $1.05, one year from now. (b) You pay $3 today. You receive $5, one year from today. You pay $2, two years from today. Determine if cases (a) and (b) are an investment or a business transaction with cash flow symbol. Find the interest rate r in the cash flow in both cases (a) and (b).
- 1 Answers
- 2106 Views
- I also Faced
- E-Mail Answers
Answer Posted / kangchuentat
ACCOUNTING AND FINANCIAL ENGINEERING - ANSWER 34.8 : Case (a) : An investment [-1, 1.05]. Let 1.05 = 1 (1 + r), r = 0.05 or 5 %. Case (b) : A business transaction [-3, 5, -2]. Let 5 (1 + r) = 2 + 3 (1 + r) ^ 2, 3 (1 + r) ^ 2 - 5 (1 + r) + 2 = 0. Let s = 1 + r, then 3s ^ 2 - 5s + 2 = 0 = (3s - 2) (s - 1). Then s = 2 / 3 or 1. When s = 2 / 3, r = s - 1 = 2 / 3 - 1 = - 1 / 3 or - 33.33 %. When s = 1, r = s - 1 = 1 - 1 = 0 %. Let ^ be the symbol of power. The answer is given by Kang Chuen Tat; PO Box 6263, Dandenong, Victoria VIC 3175, Australia; SMS +61405421706; chuentat@hotmail.com; http://kangchuentat.wordpress.com.
| Is This Answer Correct ? | 0 Yes | 0 No |
Post New Answer View All Answers
what r the question asked in interview of gate,is it related to course?
Plz if anybody has placement paper of HAL mail me i m Chemical engg my id er.kotnala@gmail.com
Cooling water line sizing ?
Name some factors to consider when trying choosing between a dry screw compressor and an oil-flooded screw compressor?
could any one plzz give me the placement tech papers taken by iocl,and bpcl in chemical stream..... my id is.... mishra.gaurang@gmail.com
What is the Import Procurement Cycle ? and what are the customization steps in SAP ?
What are some factors to consider when trying choosing between a dry screw compressor and an oil-flooded screw compressor?
What is an isochoric process?
Explain what is a good way to get started in doing a plant-wide steam consumption analysis?
What are some characteristics of bulk solids that can affect their ability to flow properly?
What is the procedure to estimate the friction factor involved in heat exchanger tubes?
What is a good relation to use for calculating tube bundle diameter?
Why is double the amount of gas collected in one of the test tubes in electrolysis of water than th amount collected in the other? Name this gas?
How can you control the ph level in our cooling water with respect to ammonia contamination?
Explain some of the consequences of an undersized kettle type reboiler?
