8.) An entrepreneur needs thousand of dollarsto launch the global expansion of hissoftware business. I have agreed to lend himthe money today (n=0) at an interest rate of8% compounded quarterly. I required thatthe loan be repaid in eight annual paymentsstarting at Year 4 with a $20K payment.Subsequent payments will decrease by$1K each year thereafter. (1) What is thepresent value of the money being borrowed?(2) Convert your Present Value to AnnualPayment.Answer:ieff = Blank 1 show in four decimalPoTotal = $ Blank 2Ⓒ starting at Year 4 with a $20K payment.Subsequent payments will decrease by$1K each year thereafter. (1) What is thepresent value of the money being borrowed?(2) Convert your Present Value to AnnualPayment.Answer:ieff Blank 1 show in four decimalPoTotal = $Blank 2A/POTotal = $ Blank 3=Note: Do not round in between solution. No need to put UOM andcomma. Final answer round to the nearest WHOLE NUMBER.

Effective annual rate (EAR) refers to a real interest rate that an investor wants from his…

An entrepreneur needs thousand of dollars to launch the global expansion of his software business. I have agreed to lend him the money today (n=0) at an interest rate of 8% compounded quarterly. I required that the loan be repaid in eight annual payments starting at Year 4 with a $20K payment. Subsequent payments will decrease by $1K each year thereafter. (1) What is the present value of the money being borrowed? (2) Convert your Present Value to Annual Payment.

An entrepreneur needs thousand of dollars to launch the global expansion of his software business. I have agreed to lend him the money today (n=0) at an interest rate of 8% compounded quarterly. I required that the loan be repaid in eight annual payments starting at Year 4 with a $20K payment. Subsequent payments will decrease by $1K each year thereafter. (1) What is the present value of the money being borrowed? (2) Convert your Present Value to Annual Payment.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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