t takes $10,000 to put on the local art festival each year. Immediately before_t he sponsoring committee determined that it had $60,000 in an account paying his year, how many more festivals can be sponsored without raising more arefully! Solution 60,000 - 10,000 = 10,000(P/A, 8%, n) (P/A, 8%, n) = 50,000/10,000 %3D
t takes $10,000 to put on the local art festival each year. Immediately before_t he sponsoring committee determined that it had $60,000 in an account paying his year, how many more festivals can be sponsored without raising more arefully! Solution 60,000 - 10,000 = 10,000(P/A, 8%, n) (P/A, 8%, n) = 50,000/10,000 %3D
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
Problem 1PS
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Question
NOTE: JUST DRAW THE CASH FLOW
Transcribed Image Text:5-2
It takes $10,000 to put on the local art festival each year. Immediately before_this year's festival,
the sponsoring committee determined that it had $60,000 in an account paying 8% interest. After
this year, how many more festivals can be sponsored without raising more money? Think
carefully!
Solution
60,000 - 10,000 = 10,000(P/A, 8%, n)
(P/A, 8%, n) = 50,000/10,000
= 5
From the i = 8% table n = 6
This is the number of festivals after this year's. There will be some money left over but not
enough to pay for a
7th
year.
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