Help - series/sequence - finance (1 Viewer)

[Petinga]

1. A firm is established with new equipment and creates a fund to provide for the replaqcemnt of the equipment after 6 years at an estimated cost of $20,000. How much should be paid into the fund annulally if interest at 11% can be obtained.

2. A family borrows $30 000 from a building society with interest at 11.5%p.a.
a)how much must be repaid each year if loan to be repaid over 30 yrs.
b)how much of loan will be outstanding at end of 18th year of loan.
c)if repayments are $4500 per year, over what period will loan be repaid.

 

[insert-username]

1. A firm is established with new equipment and creates a fund to provide for the replaqcemnt of the equipment after 6 years at an estimated cost of $20,000. How much should be paid into the fund annulally if interest at 11% can be obtained.

A = 20,000
r = 0.11
n = 6

A = P(1 + r/100)ⁿ

P = A/(1 + r/100)ⁿ

P = 20000(1 + 11/100)⁶

Solve from there.

2. A family borrows $30 000 from a building society with interest at 11.5%p.a.
a)how much must be repaid each year if loan to be repaid over 30 yrs.
b)how much of loan will be outstanding at end of 18th year of loan.
c)if repayments are $4500 per year, over what period will loan be repaid.

a) M = 30000 x 1.15³⁰ x .115/(1.115³⁰ - 1)

= $9065.90 per year

I'll work out the others later if I get time.


I_F

 

[pLuvia]

1. A firm is established with new equipment and creates a fund to provide for the replaqcemnt of the equipment after 6 years at an estimated cost of $20,000. How much should be paid into the fund annulally if interest at 11% can be obtained.

A = $20000
P = ????
n = 6
r = 0.11

20000 = P(1+0.11)⁶
P = 20000/(1.11)⁶
P = $10692.82