What amount would be available for the capital replacements

Reference no: EM131505894

Question: A foundation was endowed with $15,000,000 in July 2010. In July 2014, $5,000,000 was expended for facilities, and it was decided to provide $250,000 at the end of each year forever to cover operating expenses. The first operating expense is in July 2015, and the first replacement expense in July 2014. If all money earns interest at 5% after the time of endowment, what amount would be available for the capital replacements at the end of every fifth year forever? (Hint: Draw a cash-flow diagram first.)

Reference no: EM131505894

Questions Cloud

What approach to sampling did the authors take in article : Assignment: Evaluating a Quantitative Study- What approach to sampling did the authors take in the article, and what evidence was provided to support this?

What is the cw : What is the CW, when i = 10% per year, of $1,500 per year, starting in year one and continuing forever; and $10,000 in year five, repeating every four years.

What is the capitalized worth of the system : A city is spending $20 million on a new sewage system. The expected life of the system is 40 years, and it will have no market value at the end of its life.

What is the relationship between the present value and time : What is the value today of a $7,500 payment made in perpetuity assuming a 12% discount rate - What is the present value, today, of such a perpetuity?

What amount would be available for the capital replacements : A foundation was endowed with $15,000,000 in July 2010. In July 2014, $5,000,000 was expended for facilities, and it was decided to provide $250,000.

What research design was used in the article you selected : Evaluating a Qualitative Study- Using what you learned from your reading, what research design was used in the article you selected?

What is the fw of vidhis projected net income : Vidhi is investing in some rental property in Collegeville and is investigating her income from the investment. She knows the rental revenue will increase.

Analyze late adulthood and the death of an individual : Analyze late adulthood and the death of an individual as a culmination of the life span developmental process.

What is the fw of the tax savings : After graduation, you have been offered an engineering job with a large company that has offices in Tennessee and Pennsylvania.

User Account

All Pages