Sied Help d . . Jinny Buffett recently retired as a flight attendant and is interested in opening a fitness center and health spa exclusively for women in Grand Cayman, where she resides. After careful study, she is somewhat puzzled as to how to proceed. In her words, "I see my business going in one of two directions: Either I open the fitness center and health spa all at once, or I start with the health spa and hold off on the fitness center for a while. Either way, it should be a success because women on this island love to be pampered. My only concern about the fitness center is the initial cost, but if the projections look good enough, I know some investors in Phoenix who can help me get started. In any event, I plan to retire permanently in 11 years." Table 6-4 and Table 6-5. (Use appropriate factor(s) from the tables provided. Round the PV factors to 4 decimals.) The following information is available: Jinny has identified a suitable location for her business in a new shopping center in George Town, capital of the Cayman Islands. The developer has units of 1,250 square feet and 3,000 square feet available and is willing to sell either unit for CI$125 per square foot (CI$1.00 = US$1.25). Alternatively, the space can be leased at a cost of Ci$1,80 per square foot per month, on an annual basis. Commercial real estate values have more than doubled in Grand Cayman during the past 11 years, with no slowdown in sight. As a result Jinny is more attracted to the purchase option because she expects the price per square foot to be Ci$375 by the time she is ready to sell her unit in 11 years. Exercise machines and other equipment necessary to open the fitness center would cost US$54,000. In addition, US$34,000 would need to be invested in equipment related to the health spa. The useful life for all such equipment is 11 years, and the expected salvage value is not large enough to be concerned about . In addition, US$8,500 would need to be invested in an inventory of cosmetics and skin care products necessary to operate the health spa. This level of inventory would need to be maintained throughout the 11-year period and will be given away to loyal customers when Jinny retires permanently. The health spa can be operated in the 1250-square-foot unit. Variable operating costs would include Ci$0.20 per square foot per month for cleaning and Cl$0.40 per square foot per month for utilities. The 3,000-square-foot unit is large enough to operate both the fitness center and health spa, and the Ci$0.20 rate per square foot for cleaning would not change. However, if the 3,000 square-foot unit were used, the health spa would be located in an open loft that would need to be air-conditioned at all times. As a result, utility costs are expected to be CI$0.60 per square foot per month under this option. Jinny is a certified aesthetician and expects to do most of the makeovers, facials, and peels herself, but she needs a qualified assistant for the health spa. She estimates that hiring an appropriate person will cost US$23,000 per year. Likewise, for the fitness center, two full-time aerobics instructors would be hired for US$21,000 each per year, and a physical trainer would be hired for US$31,000 per year. . Additional fixed costs include US$4,500 per year for advertising and US$4,300 per year for maintenance, insurance, and other items. These costs will be incurred without respect to the size of operations. . Annual membership fees to the fitness center will be Cl$350, and a preliminary market survey shows a demand of approximately 475 Initial members. Although members tend to come and go, the net change in membership from year to year is not expected to be significant. No additional fees will be charged to fitness center members. Health spa fees are assessed on a user basis, although the steam room facilities are available at no charge to fitness center members. The net cash inflow from cosmetics and skin care products (after deducting the cost of inventory used and sold) is expected to be Cl$5.500 per month Jinny's cost of capital is 8%, and there are no taxes in the Cayman Islands. ULUI Uasis, although the steam room facilities are available at no charge to fitness center members. The net cash inflow from cosmetics and skin care products (after deducting the cost of inventory used and sold) is expected to be CI$5,500 per month. Jinny's cost of capital is 8%, and there are no taxes in the Cayman Islands. . Required: a. Calculate the net present value in US$ of an investment in the health spa only, assuming that the 1250-square-foot unit is purchased and then resold at the end of 11 years. (Hint: Before making your present value calculations, multiply all amounts expressed in Ci$ by $1.25 to convert into US$.) b. Calculate the net present value in US$ of an investment in the fitness center and health spa, assuming that the 3,000-square-foot unit is purchased and then resold at the end of 11 years. c. Jinny is quite concerned about possible forecasting errors and has asked you to prepare a more conservative estimate. Repeat part b, assuming that the fitness center attracts only 275 members per year (rather than 475); that the net cash inflow per month from cosmetics and skin care products is only Ci$3,500 per month (rather than Cl$5,500 per month); and that commercial real estate values in Grand Cayman at the end of 11 years are only Ci$200 per square foot (rather than Ci$375 per square foot) d. Choose why it might be in Jinny's best interest to lease (rather than purchase) the 1,250-square-foot unit if she initially decides to open the health spa only. Although no calculations are required, you should consider both quantitative and qualitative factors in your response. Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Calculate the net present value in US$ of an investment in the health spa only, assuming that the 1,250-square-foot unit is purchased and then resold at the end of 11 years. (Hint: Before making your present value calculations, multiply all amounts expressed in Ci$ by $1.25 to convert into US$.) Net present value TUNISIE Initially Ulyunu, you should consider both quantitative and qualitative fe Upulse. Complete this question by entering your answers in the tabs below. Required A Required B Required Required D Calculate the net present value in US$ of an investment in the fitness center and health spa, assuming that the 3,000-square- foot unit is purchased and then resold at the end of 11 years. Net present value (Prey 1 of 6 !!! Next > c G Search or type URL % & 8 9 0 per syuare foot ILUJC (aller than purchase) the 1,250-square-foot unit if she initia Upuli lile lealth spa only. Although no calculations are required, you should consider both quantitative and qualitativ your response. Complete this question by entering your answers in the tabs below. Required A Required B Required Required D Jinny is quite concerned about possible forecasting errors and has asked you to prepare a more conservative estimate. Repeat part b, assuming that the fitness center attracts only 275 members per year (rather than 475); that the net cash inflow per month from cosmetics and skin care products is only CI$3,500 per month (rather than CI$5,500 per month); and that commercial real estate values in Grand Cayman at the end of 11 years are only CI$200 per square foot (rather than CI$375 per square foot) (Do not round intermediate calculations. Negative amounts should be indicated by a minus sign.) Show less Net present value Prey 1 of 6 Next > G Search or type URL WUL UNU yudlitat Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Choose why it might be in Jinny's best interest to lease (rather than purchase) the 1,250-square-foot unit if she initially decides to open the health spa only. Although no calculations are required, you should consider both quantitative and qualitative factors in your response. (Select all that apply) By leasing, her initial investment cost would be reduced to only US$42,500 because the real estate cost of CI$156,250 would be eliminated. This would allow her to get started with less business risk and she would maintain flexibility in terms of her desire to open the Fitness center / health spa in one location in the future. By leasing on an annual basis, she will have plenty of time to search for the most suitable location for the combined business, and will not face the possibility of having to run her business out of two locations. Leasing will give her ownership rights. Leasing will increase the profitability of health spa. Prey 1 of 6 Next > f G Search or type URL 4 TABLE 6.5 FACTORS FOR CALCULATING THE PRESENT VALUE OF AN ANNUITY OF $1 Discount Rate No. of Periods 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% 1 2 3 4 5 0.980 1.942 2.894 3.808 4.713 0.9615 1.8861 2.7751 3.6299 4.4518 0.9434 1.8334 2.6730 3.4651 4.2124 0.9259 1.7833 2.5771 3.3121 3.9827 0.9091 1.7355 2.4869 3.1699 3.7908 0.8929 1.6901 2.4018 3.0373 3.6018 0.8772 1.6467 2.3216 2.9137 3.4331 0.9821 1.6052 2.2459 2.7982 3.2743 0.8475 1.5656 2.1743 2.6901 3.1272 0.8333 1.5278 2. 1065 2.5887 2.9906 6 7 8 9 10 5.601 6.472 7.325 8.162 8.983 5.2421 6.0021 6.7327 7.4353 8.1109 4.9173 5.5824 6.2098 6.8017 7.3801 4.6229 5.2014 5.7486 6.2489 6.7101 4.3553 4.8684 5.3349 5,7590 6.1446 4.1114 4.5638 4.9676 5.3282 5.6502 3.8887 4.2883 4.6389 4.9464 5.2161 3.6847 4.0386 4.3436 4.6065 4.8332 3.4976 3.8115 4.0776 4.3030 4.4941 3.3255 3.6046 3.8372 4.0310 4.1925 11 12 13 14 15 9.787 10.575 11.348 12.106 12.849 8.7605 7.8889 9.3851 8.3838 9.9856 8.8527 10.5631 9.2950 11.1184 9.7122 7.1390 7.5361 7.9038 8.2442 8.5595 6.4961 6.8137 7.1034 7.3667 7.6061 5.9377 6.1944 6.4235 6.6282 6.8109 5.4527 5.8803 5.8424 6.0021 6.1422 5.0286 5.1971 5.3423 6.4675 5.5755 4.6560 4.7932 4.9095 5.0081 5.0916 4.3271 4.4392 4.5327 4.6106 4.6755 16 17 13.578 11.6523 10.1069 14.292 12.1657 10.4773 14.992 12.6593 10.8276 15.678 13.1339 11.1581 16.351 13.5903 11.4699 18 8.8514 9.1216 9.3719 9.6036 9.8181 7.8237 8.0218 8.2014 8.3649 8.5136 6.9740 7.1196 7.2497 7.3658 7.4694 6.2651 6.3729 8.4674 6.5504 6.6231 5.6685 5.7487 5.8178 5.8775 5.9288 5.1624 5.2223 5.2732 5.3162 5.3527 4.7296 4.7746 4.8122 4.8435 19 20 21 22 23 24 25 10.0168 10.2007 10.3711 10.5288 10.6748 8.6487 8.7715 8.8832 8.9847 9.0770 7.5620 7.6446 7.7184 7.7843 7.8431 6.6870 6.7429 6.7921 6.8351 6.8720 5.9731 6.0113 6.0442 6.0726 6.0971 5.3837 5.4099 5.4321 5.4509 5.4069 4.8913 4.9004 4,9245 4.9371 4.9470 17.011 14.0292 11.7641 17.658 14.4511 12.0416 18.292 14.8568 12.3034 18.914 15 2470 12.5504 19.523 15.6221 12.7834 22.306 17.2920 13.7848 24.990 18.6646 14.4082 27 355 19.7928 15.0463 29.490 20.7200 15.4558 31.424 21.4822 15.7619 30 35 40 45 5.5168 5.5386 5.5482 11.2578 11.6540 11.9246 12.1084 12.2335 9.4200 9.6442 9.7791 9.3628 9.9148 8.0562 8.1755 8.2438 8.2825 8.3045 7.0027 7,0700 7.1050 7.1232 7.1327 6.1772 6.2153 6.2335 5.2421 2463 4.0789 4.9915 4.9906 4.900 4.9095 5.5541 50 TABLE 6.4 FACTORS FOR CALCULATING THE PRESENT VALUE OF SI Discount Rate No. of Periods 2% 6% 8% 10% 12% 16% 18% 20% 1 2 3 4 5 0.980 0.961 0.942 0.924 0.906 0.9615 0.9246 0.8890 0.8548 0.8219 0.9434 0.8900 0.8396 0.7921 0.7473 0.9259 0.8573 0.7938 0.7350 0.6806 0.9091 0.8264 0.7513 0.6830 0.6209 0.8929 0.7972 0.7118 0.6355 0.5674 0.8772 0.7695 0.6750 0.5921 0.5194 0.8621 0.7432 0.6407 0.5523 0.4761 0.8475 0.7182 0.6086 0.5158 0.4371 0.8333 0.6944 0.5787 0.4823 0.4019 6 7 8 0.888 0.871 0.853 0.837 0.820 0.7903 0.7599 0.7307 0.7026 0.6756 0.7050 0.6651 0.6274 0.5919 0.5584 0.6302 0.5835 0.5403 0.5002 0.4632 0.5645 0.5132 0.4665 0.4241 0.3855 0.5066 0.4523 0.4039 0.3608 0.3220 0.4556 0.3996 0.3506 0.3075 0.2697 0.3704 0.3139 0.2660 0.2255 0.1911 0.3349 0.2791 0.2326 0.1938 0.1615 9 10 0.4104 0.3538 0.3050 0.2630 0.2267 0.1954 0.1685 0.1452 0.1252 0.1079 11 12 13 14 15 0.804 0.788 0.773 0.758 0.743 0.6496 0.6246 0.6006 0.5775 0.5553 0.5268 0.4970 0.4688 0.4423 0.4173 0.4289 0.3971 0.3677 0.3405 0.3152 0.3505 0.3186 0.2897 0.2633 0.2394 0.2875 0.2567 0.2292 0.2046 0.1827 0.2306 0.2076 0.1821 0.1597 0.1401 0.1619 0.1372 0.1163 0.0985 0.0835 0.1346 0.1122 0.0835 0.0779 0.0649 16 17 18 19 20 0.728 0.714 0.700 0.686 0.673 0.5339 0.5134 0.4936 0.4746 0.4564 0.2919 0.2703 0.2502 0.2317 0.2145 0.2176 0.1978 0.1799 0.1635 0.1488 0.1631 0.1458 0.1300 0.1161 0.1037 0.1229 0.1078 0.0946 0.0829 0.0728 0.0930 0.0802 0.0891 0.0696 0.0514 0.0708 0.0600 0.0508 0.0431 0.0365 0.0541 0.0451 0.0376 0.0313 0.0261 0.3936 0.3714 0.3503 0.3306 0.3118 0.2942 0.2775 0.2818 0.2470 0.2330 21 22 23 24 25 0.680 0.647 0.634 0.622 0.610 0.4388 0.4220 0.4057 0.3001 0.3751 0.1987 0.1839 0.1703 0.1577 0.1460 0.1351 0.1228 0.1117 0.1015 0.0923 0.0926 0.0826 0.0738 0.0050 0.0588 0.0638 0.0560 0.0491 0.0431 0.0378 0.0443 0.0382 0.0329 0.0284 0.0245 0.0309 0.0262 0.0222 0.0188 0.0100 0.0217 0.0181 0.0151 0.0126 0.0106 0.0042 0.0017 0.0007 0.0003 0.0001 30 35 40 45 0.552 0.500 0.453 0.410 0.3083 0.2534 0.2083 0.1712 0.1741 0.1301 0.0972 0.0727 0.0994 0.0676 0.0400 0.0313 0213 0.0573 0.0356 0.0221 0.0137 0.0085 0.0334 0.0189 0.0107 0.0001 0.0035 0.0190 0.0102 0.0063 0.0027 0.0014 0.0116 0.0055 0.0026 0.0013 0.0006 0.0070 0.0030 0.0013 0.0005 0.0003 Sied Help d . . Jinny Buffett recently retired as a flight attendant and is interested in opening a fitness center and health spa exclusively for women in Grand Cayman, where she resides. After careful study, she is somewhat puzzled as to how to proceed. In her words, "I see my business going in one of two directions: Either I open the fitness center and health spa all at once, or I start with the health spa and hold off on the fitness center for a while. Either way, it should be a success because women on this island love to be pampered. My only concern about the fitness center is the initial cost, but if the projections look good enough, I know some investors in Phoenix who can help me get started. In any event, I plan to retire permanently in 11 years." Table 6-4 and Table 6-5. (Use appropriate factor(s) from the tables provided. Round the PV factors to 4 decimals.) The following information is available: Jinny has identified a suitable location for her business in a new shopping center in George Town, capital of the Cayman Islands. The developer has units of 1,250 square feet and 3,000 square feet available and is willing to sell either unit for CI$125 per square foot (CI$1.00 = US$1.25). Alternatively, the space can be leased at a cost of Ci$1,80 per square foot per month, on an annual basis. Commercial real estate values have more than doubled in Grand Cayman during the past 11 years, with no slowdown in sight. As a result Jinny is more attracted to the purchase option because she expects the price per square foot to be Ci$375 by the time she is ready to sell her unit in 11 years. Exercise machines and other equipment necessary to open the fitness center would cost US$54,000. In addition, US$34,000 would need to be invested in equipment related to the health spa. The useful life for all such equipment is 11 years, and the expected salvage value is not large enough to be concerned about . In addition, US$8,500 would need to be invested in an inventory of cosmetics and skin care products necessary to operate the health spa. This level of inventory would need to be maintained throughout the 11-year period and will be given away to loyal customers when Jinny retires permanently. The health spa can be operated in the 1250-square-foot unit. Variable operating costs would include Ci$0.20 per square foot per month for cleaning and Cl$0.40 per square foot per month for utilities. The 3,000-square-foot unit is large enough to operate both the fitness center and health spa, and the Ci$0.20 rate per square foot for cleaning would not change. However, if the 3,000 square-foot unit were used, the health spa would be located in an open loft that would need to be air-conditioned at all times. As a result, utility costs are expected to be CI$0.60 per square foot per month under this option. Jinny is a certified aesthetician and expects to do most of the makeovers, facials, and peels herself, but she needs a qualified assistant for the health spa. She estimates that hiring an appropriate person will cost US$23,000 per year. Likewise, for the fitness center, two full-time aerobics instructors would be hired for US$21,000 each per year, and a physical trainer would be hired for US$31,000 per year. . Additional fixed costs include US$4,500 per year for advertising and US$4,300 per year for maintenance, insurance, and other items. These costs will be incurred without respect to the size of operations. . Annual membership fees to the fitness center will be Cl$350, and a preliminary market survey shows a demand of approximately 475 Initial members. Although members tend to come and go, the net change in membership from year to year is not expected to be significant. No additional fees will be charged to fitness center members. Health spa fees are assessed on a user basis, although the steam room facilities are available at no charge to fitness center members. The net cash inflow from cosmetics and skin care products (after deducting the cost of inventory used and sold) is expected to be Cl$5.500 per month Jinny's cost of capital is 8%, and there are no taxes in the Cayman Islands. ULUI Uasis, although the steam room facilities are available at no charge to fitness center members. The net cash inflow from cosmetics and skin care products (after deducting the cost of inventory used and sold) is expected to be CI$5,500 per month. Jinny's cost of capital is 8%, and there are no taxes in the Cayman Islands. . Required: a. Calculate the net present value in US$ of an investment in the health spa only, assuming that the 1250-square-foot unit is purchased and then resold at the end of 11 years. (Hint: Before making your present value calculations, multiply all amounts expressed in Ci$ by $1.25 to convert into US$.) b. Calculate the net present value in US$ of an investment in the fitness center and health spa, assuming that the 3,000-square-foot unit is purchased and then resold at the end of 11 years. c. Jinny is quite concerned about possible forecasting errors and has asked you to prepare a more conservative estimate. Repeat part b, assuming that the fitness center attracts only 275 members per year (rather than 475); that the net cash inflow per month from cosmetics and skin care products is only Ci$3,500 per month (rather than Cl$5,500 per month); and that commercial real estate values in Grand Cayman at the end of 11 years are only Ci$200 per square foot (rather than Ci$375 per square foot) d. Choose why it might be in Jinny's best interest to lease (rather than purchase) the 1,250-square-foot unit if she initially decides to open the health spa only. Although no calculations are required, you should consider both quantitative and qualitative factors in your response. Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Calculate the net present value in US$ of an investment in the health spa only, assuming that the 1,250-square-foot unit is purchased and then resold at the end of 11 years. (Hint: Before making your present value calculations, multiply all amounts expressed in Ci$ by $1.25 to convert into US$.) Net present value TUNISIE Initially Ulyunu, you should consider both quantitative and qualitative fe Upulse. Complete this question by entering your answers in the tabs below. Required A Required B Required Required D Calculate the net present value in US$ of an investment in the fitness center and health spa, assuming that the 3,000-square- foot unit is purchased and then resold at the end of 11 years. Net present value (Prey 1 of 6 !!! Next > c G Search or type URL % & 8 9 0 per syuare foot ILUJC (aller than purchase) the 1,250-square-foot unit if she initia Upuli lile lealth spa only. Although no calculations are required, you should consider both quantitative and qualitativ your response. Complete this question by entering your answers in the tabs below. Required A Required B Required Required D Jinny is quite concerned about possible forecasting errors and has asked you to prepare a more conservative estimate. Repeat part b, assuming that the fitness center attracts only 275 members per year (rather than 475); that the net cash inflow per month from cosmetics and skin care products is only CI$3,500 per month (rather than CI$5,500 per month); and that commercial real estate values in Grand Cayman at the end of 11 years are only CI$200 per square foot (rather than CI$375 per square foot) (Do not round intermediate calculations. Negative amounts should be indicated by a minus sign.) Show less Net present value Prey 1 of 6 Next > G Search or type URL WUL UNU yudlitat Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Choose why it might be in Jinny's best interest to lease (rather than purchase) the 1,250-square-foot unit if she initially decides to open the health spa only. Although no calculations are required, you should consider both quantitative and qualitative factors in your response. (Select all that apply) By leasing, her initial investment cost would be reduced to only US$42,500 because the real estate cost of CI$156,250 would be eliminated. This would allow her to get started with less business risk and she would maintain flexibility in terms of her desire to open the Fitness center / health spa in one location in the future. By leasing on an annual basis, she will have plenty of time to search for the most suitable location for the combined business, and will not face the possibility of having to run her business out of two locations. Leasing will give her ownership rights. Leasing will increase the profitability of health spa. Prey 1 of 6 Next > f G Search or type URL 4 TABLE 6.5 FACTORS FOR CALCULATING THE PRESENT VALUE OF AN ANNUITY OF $1 Discount Rate No. of Periods 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% 1 2 3 4 5 0.980 1.942 2.894 3.808 4.713 0.9615 1.8861 2.7751 3.6299 4.4518 0.9434 1.8334 2.6730 3.4651 4.2124 0.9259 1.7833 2.5771 3.3121 3.9827 0.9091 1.7355 2.4869 3.1699 3.7908 0.8929 1.6901 2.4018 3.0373 3.6018 0.8772 1.6467 2.3216 2.9137 3.4331 0.9821 1.6052 2.2459 2.7982 3.2743 0.8475 1.5656 2.1743 2.6901 3.1272 0.8333 1.5278 2. 1065 2.5887 2.9906 6 7 8 9 10 5.601 6.472 7.325 8.162 8.983 5.2421 6.0021 6.7327 7.4353 8.1109 4.9173 5.5824 6.2098 6.8017 7.3801 4.6229 5.2014 5.7486 6.2489 6.7101 4.3553 4.8684 5.3349 5,7590 6.1446 4.1114 4.5638 4.9676 5.3282 5.6502 3.8887 4.2883 4.6389 4.9464 5.2161 3.6847 4.0386 4.3436 4.6065 4.8332 3.4976 3.8115 4.0776 4.3030 4.4941 3.3255 3.6046 3.8372 4.0310 4.1925 11 12 13 14 15 9.787 10.575 11.348 12.106 12.849 8.7605 7.8889 9.3851 8.3838 9.9856 8.8527 10.5631 9.2950 11.1184 9.7122 7.1390 7.5361 7.9038 8.2442 8.5595 6.4961 6.8137 7.1034 7.3667 7.6061 5.9377 6.1944 6.4235 6.6282 6.8109 5.4527 5.8803 5.8424 6.0021 6.1422 5.0286 5.1971 5.3423 6.4675 5.5755 4.6560 4.7932 4.9095 5.0081 5.0916 4.3271 4.4392 4.5327 4.6106 4.6755 16 17 13.578 11.6523 10.1069 14.292 12.1657 10.4773 14.992 12.6593 10.8276 15.678 13.1339 11.1581 16.351 13.5903 11.4699 18 8.8514 9.1216 9.3719 9.6036 9.8181 7.8237 8.0218 8.2014 8.3649 8.5136 6.9740 7.1196 7.2497 7.3658 7.4694 6.2651 6.3729 8.4674 6.5504 6.6231 5.6685 5.7487 5.8178 5.8775 5.9288 5.1624 5.2223 5.2732 5.3162 5.3527 4.7296 4.7746 4.8122 4.8435 19 20 21 22 23 24 25 10.0168 10.2007 10.3711 10.5288 10.6748 8.6487 8.7715 8.8832 8.9847 9.0770 7.5620 7.6446 7.7184 7.7843 7.8431 6.6870 6.7429 6.7921 6.8351 6.8720 5.9731 6.0113 6.0442 6.0726 6.0971 5.3837 5.4099 5.4321 5.4509 5.4069 4.8913 4.9004 4,9245 4.9371 4.9470 17.011 14.0292 11.7641 17.658 14.4511 12.0416 18.292 14.8568 12.3034 18.914 15 2470 12.5504 19.523 15.6221 12.7834 22.306 17.2920 13.7848 24.990 18.6646 14.4082 27 355 19.7928 15.0463 29.490 20.7200 15.4558 31.424 21.4822 15.7619 30 35 40 45 5.5168 5.5386 5.5482 11.2578 11.6540 11.9246 12.1084 12.2335 9.4200 9.6442 9.7791 9.3628 9.9148 8.0562 8.1755 8.2438 8.2825 8.3045 7.0027 7,0700 7.1050 7.1232 7.1327 6.1772 6.2153 6.2335 5.2421 2463 4.0789 4.9915 4.9906 4.900 4.9095 5.5541 50 TABLE 6.4 FACTORS FOR CALCULATING THE PRESENT VALUE OF SI Discount Rate No. of Periods 2% 6% 8% 10% 12% 16% 18% 20% 1 2 3 4 5 0.980 0.961 0.942 0.924 0.906 0.9615 0.9246 0.8890 0.8548 0.8219 0.9434 0.8900 0.8396 0.7921 0.7473 0.9259 0.8573 0.7938 0.7350 0.6806 0.9091 0.8264 0.7513 0.6830 0.6209 0.8929 0.7972 0.7118 0.6355 0.5674 0.8772 0.7695 0.6750 0.5921 0.5194 0.8621 0.7432 0.6407 0.5523 0.4761 0.8475 0.7182 0.6086 0.5158 0.4371 0.8333 0.6944 0.5787 0.4823 0.4019 6 7 8 0.888 0.871 0.853 0.837 0.820 0.7903 0.7599 0.7307 0.7026 0.6756 0.7050 0.6651 0.6274 0.5919 0.5584 0.6302 0.5835 0.5403 0.5002 0.4632 0.5645 0.5132 0.4665 0.4241 0.3855 0.5066 0.4523 0.4039 0.3608 0.3220 0.4556 0.3996 0.3506 0.3075 0.2697 0.3704 0.3139 0.2660 0.2255 0.1911 0.3349 0.2791 0.2326 0.1938 0.1615 9 10 0.4104 0.3538 0.3050 0.2630 0.2267 0.1954 0.1685 0.1452 0.1252 0.1079 11 12 13 14 15 0.804 0.788 0.773 0.758 0.743 0.6496 0.6246 0.6006 0.5775 0.5553 0.5268 0.4970 0.4688 0.4423 0.4173 0.4289 0.3971 0.3677 0.3405 0.3152 0.3505 0.3186 0.2897 0.2633 0.2394 0.2875 0.2567 0.2292 0.2046 0.1827 0.2306 0.2076 0.1821 0.1597 0.1401 0.1619 0.1372 0.1163 0.0985 0.0835 0.1346 0.1122 0.0835 0.0779 0.0649 16 17 18 19 20 0.728 0.714 0.700 0.686 0.673 0.5339 0.5134 0.4936 0.4746 0.4564 0.2919 0.2703 0.2502 0.2317 0.2145 0.2176 0.1978 0.1799 0.1635 0.1488 0.1631 0.1458 0.1300 0.1161 0.1037 0.1229 0.1078 0.0946 0.0829 0.0728 0.0930 0.0802 0.0891 0.0696 0.0514 0.0708 0.0600 0.0508 0.0431 0.0365 0.0541 0.0451 0.0376 0.0313 0.0261 0.3936 0.3714 0.3503 0.3306 0.3118 0.2942 0.2775 0.2818 0.2470 0.2330 21 22 23 24 25 0.680 0.647 0.634 0.622 0.610 0.4388 0.4220 0.4057 0.3001 0.3751 0.1987 0.1839 0.1703 0.1577 0.1460 0.1351 0.1228 0.1117 0.1015 0.0923 0.0926 0.0826 0.0738 0.0050 0.0588 0.0638 0.0560 0.0491 0.0431 0.0378 0.0443 0.0382 0.0329 0.0284 0.0245 0.0309 0.0262 0.0222 0.0188 0.0100 0.0217 0.0181 0.0151 0.0126 0.0106 0.0042 0.0017 0.0007 0.0003 0.0001 30 35 40 45 0.552 0.500 0.453 0.410 0.3083 0.2534 0.2083 0.1712 0.1741 0.1301 0.0972 0.0727 0.0994 0.0676 0.0400 0.0313 0213 0.0573 0.0356 0.0221 0.0137 0.0085 0.0334 0.0189 0.0107 0.0001 0.0035 0.0190 0.0102 0.0063 0.0027 0.0014 0.0116 0.0055 0.0026 0.0013 0.0006 0.0070 0.0030 0.0013 0.0005 0.0003