A B C D E E F G H in ooo oo 6 Answer the following compounding/discounting questions assuming year-end cash flows. The Chicago Hope Hospital purchased a MRI machine for 12 million dollars, using a 6-year loan at 8% interest. 3 4 5 a) What will be the annual payment for the machine? 6 PV $ 12,000,000 Solve for Payment: Manual Payment Calc: 8 N $2,595,784.63 4.622879664 9 0.08 $ 2,595,784.63 10 FV 11 b. The price of the MRI machine (12 million) is rising at a fixed rate of 2% each year. 12 How much would it cost to replace the MRI machine 6 years from now? 13 14 PV $ 12,000,000 Solve for Future Value: FV = PV * (1+1)^N 15 N $13,513,949.03 $ 13,513,949.03 16 I 0.02 17 PMT 18 6 0