Your friend told you about an income scheme which can give you additional income.The term of the
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Question:
Your friend told you about an income scheme which can give you additional income.The term of the scheme is 15 years. The scheme is to deposit $30,000 annually for up to 7 years. The scheme matures in 15 years. Upon maturity, it will give you $400,000. No further deposit is required from year 8 to year 14.
All deposits and withdrawal are made at the end of the year. Assume that the current interest rate is 5%. Is this a good scheme? Explain your answer.
If the scheme pays $400,000, what is the actual interest rate paid on this scheme? Use excel function to solve this problem?
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Vector Mechanics for Engineers Statics and Dynamics
ISBN: 978-0073398242
11th edition
Authors: Ferdinand Beer, E. Russell Johnston Jr., David Mazurek, Phillip Cornwell, Brian Self
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