1) Lincoln Industries intends to move to a bigger premise in 7 years’ time. With the increased space area, its director, Mr. Chan hopes to purchase new machines to boost the firm’s production capacity. The machines currently cost $250,000. The supplier has indicated that the price is likely to increase by 3% every year as a result of inflation. Mr. Chan decides to put aside a fixed sum annually in a savings plan that earns 8% p.a. for the purchase of the machine in 7 years’ time. Calculate the annual equal deposits necessary for the purchase of the machine in 7 years’ time. (Round your answer to the nearest cent.) 2) Peter intend to take up a loan for the purchase his dream car. He will make 50 equal payments monthly at an interest cost of 24% p.a. Calculate the amount of he can borrow based on this repay
1) Lincoln Industries intends to move to a bigger premise in 7 years’ time. With the increased space area, its director, Mr. Chan hopes to purchase new machines to boost the firm’s production capacity. The machines currently cost $250,000. The supplier has indicated that the price is likely to increase by 3% every year as a result of inflation.
Mr. Chan decides to put aside a fixed sum annually in a savings plan that earns 8% p.a. for the purchase of the machine in 7 years’ time.
Calculate the annual equal deposits necessary for the purchase of the machine in 7 years’ time. (Round your answer to the nearest cent.)
2) Peter intend to take up a loan for the purchase his dream car. He will make 50 equal payments monthly at an interest cost of 24% p.a. Calculate the amount of he can borrow based on this repayment.
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