the interest rate is 10%. What is the amount of the accumulated money at the end of the fifth year for the following two cases: - The amount of payments will increase by $300 for each year of the other four years The amount of payments will decrease by $150 for each year of the other four years

the interest rate is 10%. What is the amount of the accumulated money at the end of the fifth year for the following two cases: - The amount of payments will increase by $300 for each year of the other four years The amount of payments will decrease by $150 for each year of the other four years

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 22P

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Question

: A company specialized in roads construction needs money to buy
spare parts for its construction equipment fleet after five years from now. Assume
that the first payment which is $3,000 will be paid at the end of the first year, and
the interest rate is 10%. What is the amount of the accumulated money at the end of
the fifth year for the following two cases:
- The amount of payments will increase by $300 for each year of the other four years
- The amount of payments will decrease by $150 for each year of the other four years

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