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Calculate the value of interest earned

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Reference no: EM133276077

Pixel Ltd has asked you to evaluate an investment option which they are considering investing some vacant funds in. If they invest $4800 at the end of each year for 10 years, they will receive $84,230 at the end of that time. Pixel Limited has advised that they will go ahead with the investment if the interest earned on the investment is greater than 14.5%. 

You are required to complete the following: 

  1. Calculate the interest rate, which will be earned on the above investment. Evaluate information in relation to the financial profitability. ( Show all working Step)
  2. Calculate the value of interest earned over the 10 years. Based on your calculations should Pixel Limited go ahead with the above investment? Please provide a justification for the suggestion made. (Show all working Step)

Reference no: EM133276077

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