Please show work. Find the Present Worth, Anual Worth, and Future worth. Please
ID: 2729152 • Letter: P
Question
Please show work.
Find the Present Worth, Anual Worth, and Future worth. Please provide clear work with equations and answers Infiniti Q50 Initial cost $38500 so so so so so Tax and registiration s2825 S210 $187 s167 s150 $137 Maintanence so S478 $838 $1012 s2135 s2208 Insurance so S1453 $1504 $1557 s 1611 s1698 so so so so so Salvage Value based on 15% $17100 Initial cost $38,500 so so so so so Fuel s 1953 $1953 $1953 s1953 s1953 Tax and registiration s3500 S260 $235 S220 s200 $190 Tax credit $7500 so so so so so Maintanence so S500 $500 S500 s500 $500 Insurance so s 3500 $3500 s 3500 ss500 s3500 so so so so so Salvage Value based on 15% $17,082 Ford Fusion Energi Initial cost $37460 o o a o o Fuel so s 3553 $3553 $3553 ss553 s3553 Tax and registiration so s2332 $374 S374 s374 $374 Maintanence so $1111.50 $1111.50 $1111.50 $1111.50 $1111.50 Insurance so s5000 $5000 5000 S5000 S5000 so so so so so s 16546 Salvage value based on 15%Explanation / Answer
Present Worth
PV = FV *1/(1+i)n
PV = Present Value
FV =Future Value
i =discount rate
n= no. of periods.
INFINITE Q50
Intial Cash Outflows
Intial cost
38500
Tax and registration
2825
A
41325
P. V of Subsequent cash flows
1
2
3
4
5
Fuel
4355
4355
4355
4355
4355
Tax and Registration
210
187
167
150
137
Maintaince
478
838
1012
2135
2208
Insurance
1453
1504
1557
1611
1698
Total
6496
6884
7091
8251
8398
P.V factors @15%
0.8695
0.7561
0.6575
0.5717
0.4971
Discounted Value
5648.272
5204.992
4662.333
4717.097
4174.646
Total(B)
24407.34
P.V of Terminal Cashflows
At the end of Year5
17100
P.V factor(5 years,15%)
0.4971
Present value
(C)
8500.41
Present worth = P.V of Cash inflows -P.V of cash outflows (B+C-A)
= 24407.34+8500.41-41325 = (8417.25).
b)ANNUAL WORTH:
Equivalent annual worth
NPV (A/p, i,n)
-8417(A/P,15%,5)
-8417(1/3.352) = -2511
c) FUTURE WORTH:
Future worth of these cashflows at year 5 is calculating future value of NPV
Therfore ,-8417.25(1+0.15)5 =16931.29
2) TESLA 3
Intial Cash Outflows.
Intial cost
38500
Tax and registration
3500
Tax credit
-7500
A
34500
P. V of Subsequent cash flows
1
2
3
4
5
Fuel
1953
1953
1953
1953
1953
Tax and Registration
260
235
220
200
190
Maintaince
500
500
500
500
500
Insurance
3500
3500
3500
3500
3500
Total
6213
6188
6173
6153
6143
P.V factors @15%
0.8695
0.7561
0.6575
0.5717
0.4971
Discounted Value
5402.2035
4678.7468
4058.7475
3517.6701
3053.6853
Total(B)
20711.0532
Terminal Cashflows:
At the end of Year5
17082
P.V factor(5 years,15%)
0.4971
Present value
(C)
8491.4622
Present worth = P.V of Cash inflows -P.V of cash outflows (B+C-A)
= 20711+8491-34500 = (5297)
ANNUAL WORTH
Equivalent annual worth
NPV (A/p, i,n)
-5297(A/P,15%,5)
-5297(1/3.352) = -1580
FUTURE WORTH
Future worth of these cashflows at year 5 is calculating future value of NPV
Therfore ,-5297(1+0.15)5 =(10654)
FORD FUSION ENERGI:
Intial cash outflows:
Intial cost
37460
A
37460
P.V of Subsequent Cashflows
1
2
3
4
5
Fuel
3553
3553
3553
3553
3553
Tax and Registration
2332
374
374
374
374
Maintaince
1111.5
1111.5
1111.5
1111.5
1111.5
Insurance
5000
5000
5000
5000
5000
Total
11996.5
10038.5
10038.5
10038.5
10038.5
P.V factors @15%
0.8695
0.7561
0.6575
0.5717
0.4971
Discounted Value
10430.9568
7590.1099
6600.3138
5739.0105
4990.1384
Total(B)
35350.5292
P.V of Terminal Cashflows
At the end of Year5
16546
P.V factor(5 years,15%)
0.4971
Present value
(C)
8225.0166
Present worth = P.V of Cash inflows -P.V of cash outflows (B+C-A)
= 35350.52+8225-37460 = 6115
EQUIVALENT ANNUAL WORTH
Equivalent annual worth
NPV (A/p, i,n)
6115(A/P,15%,5)
6115(1/3.352) = -1824
FUTURE WORTH
Future worth of these cashflows at year 5 is calculating future value of NPV
Therfore , 6115(1+0.15)5 =12299
Intial cost
38500
Tax and registration
2825
A
41325