A firm wants to buy a new tank after depositing same amount of money two timesin a year for 5 years with nominal interest rate of 6% semiannually. Deposits will be done from2022-2027. The first payment for the tank will be at end of 2028 as 100.000$, the second paymentwill be at the end of 2029 as 250.000$ in todays dollars. Inflation rate is 5%. Find how much thefirm should deposit each time.

The future value of payment consist of amount deposited and compound interest accumulated till date.

A firm wants to buy a new tank after depositing same amount of money two times 5 years with nominal interest rate of 6% semiannually. Deposits will be done from he first payment for the tank will be at end of 2028 as 100.000$, the second payment end of 2029 as 250.000$ in todays dollars. Inflation rate is 5%. Find how much the Leposit each time.

A firm wants to buy a new tank after depositing same amount of money two times 5 years with nominal interest rate of 6% semiannually. Deposits will be done from he first payment for the tank will be at end of 2028 as 100.000$, the second payment end of 2029 as 250.000$ in todays dollars. Inflation rate is 5%. Find how much the Leposit each time.

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter4: Time Value Of Money

Section: Chapter Questions

Problem 34P

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