Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Problem #1: Gwen just bought solar panels to power ventilation at her chicken farm. The panels cost $2000 and will reduce her electricity bills by
Problem #1: Gwen just bought solar panels to power ventilation at her chicken farm. The panels cost $2000 and will reduce her electricity bills by $40 per month. How long will it take her to recoup her investment in the panels if she can earn 12% interest, compounded monthly, on her money? (Hint: You can use either the Capital Recovery Factor formula or the Series Present Worth Factor formula, or you can use linear interpolation!) ALLC 6 Problem # 2: Your company has a $800,000, loan for a new plasma soldering machine. The interest rate for this loan is 5% per year and your company's initial plan is to pay for the loan in exactly 15 years. Annual payment is made at the end of each year. (a) What is the Annual Payment your company has to pay at the end of each year? (b) Based on the initial annual payment calculated above, your company has now decides that it can afford to pay $100,000 per year, which is more than the initial annual payment. By paying $100,000 annually, how many payments (years) will the loan of $800,000. be paid off? Assuming the same interest rate is used, i.e. 5% annually. (c) By paying $100,000 annually, how much is the last payment
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started