What is the original amount of the loan

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Reference no: EM131991776

1. The market for widgets is increasing by 15% per year from current profits of $2,000,000. Investing in a design change will allow the profit per widget to stay steady; otherwise the price will drop by 3% per year. If inflation in the economy is 4%, what is the present worth in Year-1 dollars of the savings over the next 5 years? The interest rate is 10%.

2. Karen plans to repay a loan with an effective rate of interest of 5.7% by annual payments. The first payment of $1500 comes one year from now, and each subsequent payment is $70 larger than the previous. If she will make 27 total payments, what is the original amount of the loan?

Answer = $ (3 decimal place)

Reference no: EM131991776

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