Maintenance money for an athletic complex has been sought. Mr. Kendall, the Athletic Director, would like to solicit a donation to cover all future expected maintenance costs for the building. These maintenance costs are expected to be $1.2 million each year for the first five years, $1.6 million each year for years 6 through 10, and $1.9 million each year after that. (The building has an indefinite service life.) If the money is placed in an account that will pay 7% interest compounded annually, how large should the gift be? Click the icon to view the interest factors for discrete compounding when i = 7% per year. The gift should be $31.35 million. (Round to two decimal places.) More Info N 1 Single Payment Compound Amount Factor (F/P, I, N) 1.0700 Present Worth Factor (P/F, I, N) 0.9346 Compound Amount Factor (F/A, I, N) 1.0000 Equal Payment Series Sinking Present Fund Worth Factor Factor (P/A, I, N) 0.9346 (A/F, I, N) 1.0000 Capital Recovery Factor (A/P, I, N) 1.0700 - X

Maintenance money for an athletic complex has been sought. Mr. Kendall, the Athletic Director, would like to solicit a donation to cover all future expected maintenance costs for the building. These maintenance costs are expected to be $1.2 million each year for the first five years, $1.6 million each year for years 6 through 10, and $1.9 million each year after that. (The building has an indefinite service life.) If the money is placed in an account that will pay 7% interest compounded annually, how large should the gift be? Click the icon to view the interest factors for discrete compounding when i = 7% per year. The gift should be $31.35 million. (Round to two decimal places.) More Info N 1 Single Payment Compound Amount Factor (F/P, I, N) 1.0700 Present Worth Factor (P/F, I, N) 0.9346 Compound Amount Factor (F/A, I, N) 1.0000 Equal Payment Series Sinking Present Fund Worth Factor Factor (P/A, I, N) 0.9346 (A/F, I, N) 1.0000 Capital Recovery Factor (A/P, I, N) 1.0700 - X

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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