Practice Example Calculation of Present Worth - 2.2 | 9. Uniform Series Capital Recovery Factor | Construction Engineering & Management - Vol 1
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Knowledge

2.2 - Example Calculation of Present Worth

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Learning

Practice Questions

Test your understanding with targeted questions related to the topic.

Question 1

Easy

Define the uniform series capital recovery factor.

💡 Hint: Think about loan repayments.

Question 2

Easy

What does the present worth factor help you calculate?

💡 Hint: Recall our discussion on cash flow valuation.

Practice 4 more questions and get performance evaluation

Interactive Quizzes

Engage in quick quizzes to reinforce what you've learned and check your comprehension.

Question 1

What does the uniform series capital recovery factor determine?

  • Loan repayment amount
  • Total cost of ownership
  • Future cash flows

💡 Hint: Think about the purpose of loan repayments.

Question 2

True or False: The present worth factor can be used to calculate future cash flows.

  • True
  • False

💡 Hint: Recall how we evaluated cash flows.

Solve 1 more question and get performance evaluation

Challenge Problems

Push your limits with challenges.

Question 1

A landscaping business needs to evaluate the purchase of a new lawnmower. The purchase price is $20,000, with an expected resale value of $5,000 after 5 years. If the interest rate is 5%, calculate the annualized ownership cost.

💡 Hint: Consider how to calculate both the depreciation and any associated operating expenses.

Question 2

A company plans to replace machinery costing $100,000 after its 7-year life. They need to know how much to deposit each year into a sinking fund that compounds at a rate of 6% to gather the needed amount when the machine is replaced. Calculate the annual deposit amount.

💡 Hint: Think about using the sinking fund formula to find the annual deposits needed.

Challenge and get performance evaluation