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In five years, ABC Construction plans to purchase a new excavator for its fleet at an anticipated cost of $145,000. The available interest rate is
In five years, ABC Construction plans to purchase a new excavator for its fleet at an anticipated cost of $145,000. The available interest rate is 4% per four-month period. (a.) Sketch the cash flow diagdam. (b.) What is the effective annual interest rate [4SF]? (ie) (c.) What amount must be invested today to accrue $145,000 in five years? [whole dollar]
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