Question: To replace a machine in future, a company is placing equal payments into a sinking fund at the end of each year so that after

To replace a machine in future, a company is placing equal payments into a sinking fund at the end of each year so that after

12

years the amount in the fund is $

155, 000 .

The fund earns

7.5 %

interest compounded annually. After

5

years the interest increases and the fund pays

8 %

compounded annually. Because of higher interest rate, the company decreases the amount for the remaining payments. Find the amount of the new payments. Round to the nearest dollar.

To replace a machine in future, a company is placing equal

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