Solve the Problem. -What Is the Cost of Lighting a 500-Watt Outdoor Light

question 68

Multiple Choice

Solve the problem.
-What is the cost of lighting a 500-watt outdoor light for 8 hours, if electricity costs 7.5¢ per kilowatt-hour?

• A)30 cents
• B)60 cents
• C)67 cents
• D)45 cents

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Definitions:

Equal Present Values

A financial concept where two or more cash flows or investments are considered equivalent based on their present values, even if the nominal amounts differ.

Discount Rate

The rate used in the DCF approach to quantify the present value of cash flows expected to occur in the future.

Monthly Payments

Regular payments made over a period of time, often used in loans or leasing agreements.

Growing Annuity

A financial term that refers to a series of cash flows or payments that grow at a fixed rate per period.