3. A corporation plans a capital expansion program that requires the following estimated expenditures: Php 2,000,000 five years hence; Php 3,000,000 eight years hence; and Php 1,600,000 twelve years hence. To accumulate the required capital, it has established a sinking fund in which it will make 12 equal annual deposits, the first deposit to be made 1 year hence. If the interest rate of the fund is 6%, what annual deposit is required? Hat will be the principal in the fund 6 years hence?
3. A corporation plans a capital expansion program that requires the following estimated expenditures: Php 2,000,000 five years hence; Php 3,000,000 eight years hence; and Php 1,600,000 twelve years hence. To accumulate the required capital, it has established a sinking fund in which it will make 12 equal annual deposits, the first deposit to be made 1 year hence. If the interest rate of the fund is 6%, what annual deposit is required? Hat will be the principal in the fund 6 years hence?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Transcribed Image Text:3. A corporation plans a capital expansion program that requires the
following estimated expenditures: Php 2,000,000 five years hence; Php
3,000,000 eight years hence; and Php 1,600,000 twelve years hence. To
accumulate the required capital, it has established a sinking fund in
which it will make 12 equal annual deposits, the first deposit to be
made 1 year hence. If the interest rate of the fund is 6%, what annual
deposit is required? Hat will be the principal in the fund 6 years hence?
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