What must be deposited semi-annually into this fund

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Q1) Lowell Corporation wishes to establish a sinking fund to retire a $200,000 debt that is due in 10 years. If the investment will earn interest at the rate of 9% per year compounded quarterly, determine the size of each (equal) quarterly deposit in the fund.

Q2) A city has $2.5 million worth of school bonds that are due in 20 years and has established a sinking fund to retire his debt. If the funds earn interest at the rate of 7% compounded semi-annually, what must be deposited semi-annually into this fund?

Reference no: EM132757066

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