1. Shifted Uniform Series
A shifted uniform series starts at a time other than year 1
When using P/A or A/P, P is always one year ahead of first A
When using F/A or A/F, F is in same year as last A
Example: The present worth of the cash flow shown below at i=10% is:
(a) $25, (b) $29, (c)$34, (d) $37,908
P=?
A=10,000
i=10%
Solution: (1) Use P/A factor with n=5 to get P in year 1:
P1= 10,000(P/A,10%,5) =10,000(3.7908) = $37,908
(2) Use P/F factor with n=1 to move P back to year 0:
P0= P1(P/F,10%1) = 37,908(0.9091) = $34,462
Answer is (c)