As mentioned in the chapter introduction of this case, the ...
The present worth value is less than the investment plus a 10 % per year return, so the president should not be satisfied with the projected annual revenue. To determine the minimum required to realize a 10 % per year return, use the A/P factor. The cash flow diagram is the same as Figure 2–4 b, where A starts 1 year after P at t = 0 and n = 5.