Question: Find the ROI for the following 5-year venture. Interest is compounded quarterly. Draw the net worth diagram that shows the net worth at each year.
- Purchase $20,000 of equipment and pay 5,000 to have it installed.
- Pay 1,500 for utilities at the end of each year.
- Earn $10,000 income at the end of the first year, then 20,000 at the ends of each of the next years.
- Sell the equipment for $2000
Please draw a cash flow diagram as well as a net-worth diagram that shows the net worth at each year and show the calculations for the ROI.