ENGR390: Engineering Economy

Section #2: TR 1000 - 1120

Name: __________________

Quiz #1a – October 16, 2008 Last 3 digits of your Student ID #: __________________

The quiz is closed book and open notes. There are three questions of equal weight. Unless
specified otherwise, all answers must have the following:
1) Cash flow diagrams with cash flow values, interest, and periods.
2) Equation used to solve the problem.
3) Answer (highlighted)

1. $5000 is deposited today into an account that pays interest at the rate of 6% per year
compounded quarterly. How much will be in the account 8 years from today?

2. $2000 is deposited at the end of every month for the next 4 years into an account that pays
interest at the rate of 12% per year compounded monthly. The first deposit is made 1 month
from today and the last deposit is made 4 years from today. Determine how much will be in
the account 10 years from today.
3. Determine the present equivalent (today, at point P) of the following end of the year series of
future deposits, with the first deposit of $100 made 2 years from today, i.e. at the end of year
2 and the last deposit made 10 years from today. Use an interest rate of 6% per year,
compounded annually.

+----+----+----+----+----+----+----+----+----+----+
End of Year 0 1 2 3 4 5 6 7 8 9 10
Deposit ($) 0 0 100 100 100 150 200 250 300 350 400
^
P
 ENGR390: Engineering Economy
Section #2: TR 1000 - 1120
Name: __________________

Quiz #1b – October 16, 2008 Last 3 digits of your Student ID #: __________________

The quiz is closed book and open notes. There are three questions of equal weight. Unless
specified otherwise, all answers must have the following:
1) Cash flow diagrams with cash flow values, interest, and periods.
2) Equation used to solve the problem.
3) Answer (highlighted)

1. $3000 is deposited today into an account that pays interest at the rate of 6% per year
compounded semi-annually. How much will be in the account 12 years from today?

2. $2000 is deposited at the end of every month for the next 3 years into an account that pays
interest at the rate of 6% per year compounded monthly. The first deposit is made 1 month
from today and the last deposit is made 3 years from today. Determine how much will be in
the account 9 years from today.
3. Determine the present equivalent (today, at point P) of the following end of the year series of
future deposits, with the first deposit of $100 made 3 years from today, i.e. at the end of year
3 and the last deposit made 10 years from today. Use an interest rate of 6% per year,
compounded annually.

+----+----+----+----+----+----+----+----+----+----+
End of Year 0 1 2 3 4 5 6 7 8 9 10
Deposit ($) 0 0 0 100 100 125 150 175 200 225 250
^
P