1. A cash flow has $800 at Year 1 and $200 per year in Years 5-8....

Transcribed Image Text:

1. A cash flow has $800 at Year 1 and $200 per year in Years 5-8. What is the present worth of the cash flow at an interest rate of 6%? 2. MBTA needs to borrow $20 million now at an interest rate of 4% to build a set of subway cars. It will make 20 equal annual payments of A dollars starting at year 4. What is A? 1. A cash flow has $800 at Year 1 and $200 per year in Years 5-8. What is the present worth of the cash flow at an interest rate of 6%? 2. MBTA needs to borrow $20 million now at an interest rate of 4% to build a set of subway cars. It will make 20 equal annual payments of A dollars starting at year 4. What is A?