What periodic sinking fund payment is required

Assignment Help Business Economics

Reference no: EM13837252

A sinking fund is established by Alliance, Inc., at 8% interest compounded semiannually to meet a financial obligation of $1,800,000 in 4 years.

a. What periodic sinking fund payment is required every 6-months to reach the company's goal?

b. How much greater would the payment be if the interest rate was 10% compounded semiannually rather than 8%

Reference no: EM13837252

Questions Cloud

What is your topic and what is its business significance : Define your 1st key word or phrase. Provide strengths and weaknesses from literature about the topic. Provide at least 4 references. Analyse your hypothesis about this topic and discuss your conclusion - What combinations of analytical and statisti..

Total interest would have been paid by end of month three : Suppose that the initial loan of $20,000 and interest rate 1.2% per month. Interest due is paid at end of each month. $10,000 of the original unpaid balance is to be repaid at the end of month two and three only. How much total interest would have be..

Find the total installment cost and annual percentage rate : A small business owner purchased an HP computer system for $14,000. After making a down payment of $2,000, he agreed to make payments of $500.00 per month for 24 months. Find (a) the total instalment cost (b) the annual percentage rate.

Find average daily balance for the credit card account : Find the average daily balance for the following credit card account. Assume one month between billing dates using the proper number of days in the month. Then find the finance charge is interest is 1.5% per month on the average daily balance. Finall..

What periodic sinking fund payment is required : A sinking fund is established by Alliance, Inc., at 8% interest compounded semiannually to meet a financial obligation of $1,800,000 in 4 years. What periodic sinking fund payment is required every 6-months to reach the company's goal?

How much will the account be worth : As a savings plan for college, the Smithfield's deposited $15,000 in an account paying 6% compounded annually when their daughter Mary was born. How much will the account be worth when Mary is 18 years old?

Game has nash equilibrium-every player is rational : Suppose we have a game G with an epistemic background such that (1) every player has beliefs consistent with knowledge, (2) every player is rational and (3) every player knows the type of every other player. Then such a game has a Nash Equilibrium.

What is the annual effective irr of this investment : A solar panel has an installed cost of $2900, and it reduces the homeowner’s energy bill by $29 per month. The residual value of the solar panel is negligible at the end of its 11-year life. What is the annual effective IRR of this investment?

Identify data that should incorporated into cgcs new system : Identify the data that should be incorporated into CGCs new system to provide adequate planning capability. Explain why each data item it is important and the level of detail needed for the data to be useful.

User Account

All Pages