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Engineering economy QUESTION 4 (10 Marks) Enrico Suarez has decided to purchase a...

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Engineering economy

QUESTION 4 (10 Marks) Enrico Suarez has decided to purchase a house instead of renting an apartment. He can afford a monthly payment of $800, and he has saved $6,000 to use as a down-payment on a house. a) Draw cash flow diagram. b) If the mortgage is 4% nominal interest (compounded monthly) on a 30-year loan, how much can Enrico afford to spend on a house? QUESTION 5 (20 Marks) Consider the cash-flow diagram given below A/year End of Year Interest-)%year Determine, a) b) If P-S1,000, A-S200, and f%-12% per year, then N-? If p-$1,000, A-$200, and N-10 years, then I e? QUESTION 6 (10 Marks) Calculate the future equivalent at the end of 2012, at 8% per year, of the following series of cash flows in Figure P4-80: [Use a uniform gradient amount (G) in your solution.] Years 20102011 2009 2012 80 $1,000 ***End of Paper

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