Question: 1. The cost to equip a large cruise ship with security cameras is $500,000. If the interest rate is 15% per year and the cameras have a life of six years, what is the equivalent annual cost (A) of the security cameras?
2. Determine the annual equivalent amount over 4 years for the following cash flow (CF) pattern. The nominal interest rate is 10%, and it is compounded monthly.
EOY 0 1 2 3 4
CF -$7,500 -$2,000 $14,000 $18,000 $4,000