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Ne-yo borrowed 500,000 to build a recording studio in his home. The total amount of debt along with 8% annual interest must be repaid in
Ne-yo borrowed 500,000 to build a recording studio in his home. The total amount of debt along with 8% annual interest must be repaid in 15 years. He decides to invest in a debt sinking fund that will be used to retire the debt. The fund earns 10% interest and requires him to pay an equal amount each year (end of each year) starting in year 5 and lasting through the maturity. Interest is compounded annually. What must Ne-yo contribute each year in order to successfully retire the debt in 15 years?
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