An investment of 1000 is to be used to make payments of 10 at the end of the first year,20 at the end of the second year, 30 at the end of the third year, etc., every year for aslong as possible. A smaller final payment is paid one year after the last regular payment.The fund earns an effective rate of interest of 4%.Calculate the amount of the smaller final payment R. (Hint: By doing trial and error,one can find that the last full payment is made at the end of 17th year.)3839 40 4142

Investment amount = 1000The investment amount is to be used to make payments of 10 at the end of the…

Answered: An investment of 1000 is to be used to…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 16P

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