The human resource management discipline that covers all of the things that need to happen to get people interested in working f
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Answer:
EAA = $17,115.23
Explanation:
Please check the attached image for the formula of the equivalent annual annuity
To calculate the EAA, the NPV of project Y has to be determined:
Net present value can be calculated using a financial calculator:
Cash flow in year 0 = $-120,000
Cash flow in year 1 = $64,000
Cash flow in year 2 = $67,000
Cash flow in year 3 = $56,000
Cash flow in year 4 = $45,000
I = 15%
NPV = $48,863.60
EAA = $17,115.23
To find the NPV using a financial calacutor:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. After inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
I hope my answer helps you
