Downtown Medical Center is starting an endowment fund to pay for the expenses of a community outreach pediatric program. The expenses are $800,000 per year, and the program is expected to last five years. Assuming payments are made at the end of each year and the interest rate is 7 percent per year, what should be the size of the initial endowment?

Downtown Medical Center is starting an endowment fund to pay for the expenses of a community outreach pediatric program. The expenses are $800,000 per year, and the program is expected to last five years. Assuming payments are made at the end of each year and the interest rate is 7 percent per year, what should be the size of the initial endowment?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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