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1. A person borrows the amount of $1000 to be paid in 5 years at an interest rate of 20% per year.How much would this

1. A person borrows the amount of $1000 to be paid in 5 years at an interest rate of 20% per year. How much would this person pay at the end of year 5?

2. What amount is necessary to deposit now in a savings account, paying 10% annually, to accumulate $10,000 at the end of year 5?

3. If $1,000 per year is deposited in a savings account that pays 15% annually for 5 years, how much would the savings be at the time of the last deposit? Including the last deposit.

4. A person deposits $10,000 per year in a savings account for 5 years, after making the last deposit, half of the balance is immediately withdrawn. Subsequently, starting the following year, $20,000 per year is deposited in the same account for 5 more years. If the savings account earns 10% annually, what amount would be withdrawn at the end of year 15?

5. An electronics store is considering purchasing software that will minimize shipping costs. The software costs $10,000,000, including installation and training costs. If the interest rate is 15% per year and the useful life of the software is 4 years, with a surrender value of $50,000, what is the amount of annual savings that justifies purchasing the software?

6. A project to manufacture and market smart locks compatible with Alexa and Google Home requires an investment of $3.5 million pesos. Considering that the equipment has a salvage value in year 5 of $400,000 and a rate of 10% per year, how much would the minimum annual profits have to be per year to justify the investment?

7. It is estimated that some equipment can produce savings of $22,000 per year, with a life expectancy of 5 years and a salvage value of $8,000. If the company needs to earn a return on investment of 10% per year, what Is the price of the equipment worth the investment?

8. What amount must be deposited in a savings account paying 10% annually so that $700 can be withdrawn at the end of year 1, $1,500 at the end of year 3, and $2,000 at the end of year 5 and the account is depleted? 

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SOLUTION 1 To calculate the amount to be paid at the end of year 5 on a 1000 loan with an interest rate of 20 per year we use the formula for compound interest Future Value Principal 1 Interest RateNu... blur-text-image

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