A father wants to set up a bank account that will pay his daughter $18,000 at the
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A father wants to set up a bank account that will pay his daughter $18,000 at the end-of-quarter (EOQ) 4 and $32,000 at EOQ 8. He will fund this account by making quarterly payments of $X from the present (time zero) through EOQ 7.
a. Draw a cash-flow diagram from the father’s viewpoint.
b. If the quarterly percentage rate is 2%, what is the value $X that must be deposited into the account?
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a b The future compound value of the cash outflows from the ...View the full answer
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Related Book For
Engineering Economy
ISBN: 978-0133439274
16th edition
Authors: William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
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