What is the present value of a series of 10 deposits of 200 (dollar/yr) made at

Question

What is the present value of a series of 10 deposits of 200 (dollar/yr) made at the end of each year if the first deposit is made in 1968? How much will be accumulated In a fund, earning 8 percentage interest, 10 years after the first deposit of dollar 118 is deposited. Deposits are made at the end of each year for 10 years. At what rate of interest compounded annually will an investment of dollar 10, 000 triple itself in 8 years? What is the equivalent annual payment series of that dollar 10, 000 at that interest rate? How much invested now at 5 percentage would be just enough to provide for four lump sum payments of dollar 6000 at t = 5, 10, 15, and 20? Make this problem in two different ways. Method #1: use only single amount equivalence factors. Method 0.2: use only uniform series equivalence factors. A bank offers depositors daily compounding of interest. It adver­tizes the nominal interest as being 6.5X. Compute the equivalent annual uniform series of incomes someone could count on for 20 years if deposited 1,000, 000 (dollar). The operating expenses for a road building machine are 4000 (S/year.) for 6 years. The maintenance and repair costs are 500 (dollar/year) in 2, 1000 (dollar/yr) in year 3, 1500 (dollar/yr> in year 4, and so on. What 1 the present value of the machine if its purchase price new is 30, 000 (dollar)? (tau = 5 percentage)

Explanation / Answer

answer no 4 using PV function rate 6%. Nper = 10 annuity value 200 present value of annuity PV(6%,10,-200,0,0) $1,472.02 answer no 5 using fv function rate 8%, nper 10 years, annuity value 118 Future value of deposit FV(8%,10,-118,0,0) $1,709.41 answer no 6 using rate function PV= 10000 FV =10000 time 8 years rate of interest RATE(8,0,-10000,30000,0) 14.72% using pmt function we can find out the amount of annuity equivalent payment annuity equivalent payment PMT(14.72%,8,0,30000,0) ($2,208.06) answer no 7 Method 2 Year 5 6000 0.783526 4701.157 10 6000 0.613913 3683.48 15 6000 0.481017 2886.103 20 6000 0.376889 2261.337 present amount of investment 13532.08 method 1 annuity amount single equivalence factor 6000 2.255346 13532.08 answer no 8 we shall use PMT function to calculate the future income value of annuity income PMT(0.541%,240,-1000000,0,0) $7,451.02 ANSWER NO 9 Year operating expense repairs total expense present value @5% present value 1 4000 4000 0.952381 3809.524 2 4000 500 4500 0.907029 4081.633 3 4000 1000 5000 0.863838 4319.188 4 4000 1500 5500 0.822702 4524.864 5 4000 2000 6000 0.783526 4701.157 6 4000 2500 6500 0.746215 4850.4 sum of present value 26286.77 purchase price of new machine 30000 current worth of machine 3713.235

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