Welcome to Westonci.ca, the Q&A platform where your questions are met with detailed answers from experienced experts. Explore thousands of questions and answers from knowledgeable experts in various fields on our Q&A platform. Join our Q&A platform to connect with experts dedicated to providing accurate answers to your questions in various fields.
Sagot :
Answer:
$14,336
Explanation:
Calculation to Determine the difference in the present worth values
First step is to calculate Contract 1 present worth values
Contract 1 present worth values = 10,000{1 – [(1 + 0.04)/(1 + 0.08)]^10}/(0.08 – 0.04)
Contract 1 present worth values = 10,000{1 – [(1.04)/(1 .08)]^10}/( 0.04)
Contract 1 present worth values = $78,590
Second step is to Contract 2 present worth values
Contract 2 present worth values
= 10,000{1 – [(1 +0.06)/(1 +0.08)]^11}/(0.08 – 0.06)=
Contract 2 present worth values
= 10,000{1 – [(1 .06)/(1 .08)]^11}/( 0.02)
Contract 2 present worth values = $92,926
Now let calculate the difference in the present worth values
Present worth values Difference =$92,926-$78,590
Present worth values Difference =$14,336
Therefore the difference in the present worth values will be $14,336
Thank you for visiting. Our goal is to provide the most accurate answers for all your informational needs. Come back soon. Thank you for your visit. We're committed to providing you with the best information available. Return anytime for more. Thank you for using Westonci.ca. Come back for more in-depth answers to all your queries.