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A cash flow sequence starts in year 1 at $4000 and decreases by $300 each year through year 9. Determine (a) the value of the gradient G

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Final answer:

The value of the gradient G in the decreasing cash flow sequence is $331.25, calculated by rearranging and simplifying the provided equation.

Step-by-step explanation:

The question involves finding the value of the gradient G in a cash flow sequence that starts at $4000 in year 1 and decreases by $300 each subsequent year until year 9. The provided equation includes various elements that are not relevant to the gradient calculation. However, focusing on the relevant part:

Y = 400 + 0.85(Y – 0.25Y) + 300 + G + 500 + 0.1(Y-0.25Y)

To find the value of G, we rearrange the equation:

3500 = 400 + 0.85(3500 -0.25(3500)) + 300 + G + 500 - 0.1(3500 – 0.25(3500))

After simplifying and solving for G, we find:

G = 3500 - 400 - 2231.25 - 1300 - 500 + 262.5

G = 331.25

Therefore, the value of the gradient G for the cash flow sequence is $331.25.

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