Calculate how much must set aside now

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You are the finance manager for Olympia Industries. The company plans to purchase $1,000,000 in new assembly line machinery in 5 years.

-How much must be set aside now at 6% interest compounded semiannually to accumulate the $1,000,000 in 5 years?

-If the inflation rate on this type of equipment is 4% per year, what will be the cost of the equipment in 5 years, adjusted for inflation?

-Use the inflation adjusted cost of the equipment to calculate how much must set aside now.

-Use the percent value formula to calculate how much would be required now if you found a bank that offered 6% interest compounded daily.

Reference no: EM133030763

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