Asked by Mary Ann
Find the amount of periodic payment necessary for the deposit to a sinking fund. (Round your answer to the nearest cent.)
Amount Needed A $50,000
Frequency n semiannually
Rate r 11%
Time t 15 years
Thank you for your time, it is appreciated.
Amount Needed A $50,000
Frequency n semiannually
Rate r 11%
Time t 15 years
Thank you for your time, it is appreciated.
Answers
Answered by
MathMate
Future value = 50000
period = semi-annual
number of periods, n = 15*2=30
Annual interest rate, = 11%
i = 0.11/2=0.055
Periodic payment (6 months) = P
Let r=1+i=1.055
Future value, 50000
= P(1+r+r²+r³+...+r<sup>n-1</sup>)
= P(r<sup>n</sup>-1)/(r-1) by factorizing
therefore, using (r-1)=i,
P=50000*i/(r<sup>n</sup>-1)
=50000*0.055/(1.055<sup>30</sup>-1)
=690.27 per period of 6 months.
period = semi-annual
number of periods, n = 15*2=30
Annual interest rate, = 11%
i = 0.11/2=0.055
Periodic payment (6 months) = P
Let r=1+i=1.055
Future value, 50000
= P(1+r+r²+r³+...+r<sup>n-1</sup>)
= P(r<sup>n</sup>-1)/(r-1) by factorizing
therefore, using (r-1)=i,
P=50000*i/(r<sup>n</sup>-1)
=50000*0.055/(1.055<sup>30</sup>-1)
=690.27 per period of 6 months.
Answered by
Mary Ann
thank you for your time it is appreciated.
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