2 1. A automobile was purchased on a 60-monthinstallment plan with a $10,000 monthlypayment. Calculate the car's cash price ifinterest is compounded annually at 12.03%.2. A steel factory forecasts that one of itsfurnaces will require 20,000 dollars inmaintenance after two years, 40,000 dollarsafter four years, and 80,000 dollars after eightyears. What consistent semi-annual amountsmight it set aside at the end of each period forthe next eight years to fulfill these maintenanceexpense requirements if all funds earnedinterest at a rate of 6.02% compounded semi-annually?NEED ASAP.

(1) Monthly Installment (Annuity)= $10,000 n = 60 months interest rate = 12.03%12=1.0025%

Answered: 1. A automobile was purchased on a…

1. A automobile was purchased on a 60-month installment plan with a $10,000 monthly payment. Calculate the car's cash price if interest is compounded annually at 12.03%.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

1. A automobile was purchased on a 60-month
installment plan with a $10,000 monthly
payment. Calculate the car's cash price if
interest is compounded annually at 12.03%.
2. A steel factory forecasts that one of its
furnaces will require 20,000 dollars in
maintenance after two years, 40,000 dollars
after four years, and 80,000 dollars after eight
years. What consistent semi-annual amounts
might it set aside at the end of each period for
the next eight years to fulfill these maintenance
expense requirements if all funds earned
interest at a rate of 6.02% compounded semi-
annually?
NEED ASAP.

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