Problem
Equipment is bought for an initial cost of $20,000. Its operation will result in a net income of $6,000/Yr for the first year, increasing by $1,000 each year after year 1. At the end of the fifth year, the equipment is sold for $5,000. The prevailing interest rate for the next five years is estimated at 10%.
a. Draw the cash flow diagram for this project.
b. Calculate the NPW.
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.