M Inbox (3620).jrbrodeur x D Appendi F and Chapter × Solved: Comp uting the r ×
ID: 2584387 • Letter: M
Question
M Inbox (3620).jrbrodeur x D Appendi F and Chapter × Solved: Comp uting the r × -) coezto.mheducation.com/hm.tpx Question 2 ( value 14.28 points Exercise F-2 Computing the payment amount Barry Rich is a business major at State U. He will be graduating this year and is planning to start a consulting business. He will need to purchase computer equipment that costs $29,000. He can borrow the money from the local bank but will have to make annual payments of principal and interest To determine the appropriate discount factor(s) using tables, click here to view Tables I.II. IlL or IV in the places before using the factor in the problem Required appendix. Alternatively, if you calculate the discount factor(s) using a formula, round to six (6) decimall a. Compute the annual payment Barry will be required to make on a $29,000, four-year, 8 percent loan. Round your answer to the nearest dollar amount.) b. If Barry can afford to make annual payments of $5,500, how much can he borrow?(Round your answer to the nearest dollar amount.) that can be Type here to search ooe@Explanation / Answer
1 PV factor i = 8% Year 1 0.925926 Year 2 0.857339 Year 3 0.793832 Year 4 0.735030 Total 3.312127 Annual payment = Cost of asset / PV annuity factor 4years i = 8% Computer equipment 29000 Pv factor for n=4 i =8% 3.312127 Annual payment 8756 (29000/3.312127) 2 Pv factor for n=4 i =8% 3.312127 Annual payment 5500 Total loan that can be taken 18217 (3.312127*5500)
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.