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Question 4 all parts with formulas please each GD has a five year sssatsarity Now consider the surgery centers' goal of havine 3. $200,ooo available
Question 4 all parts with formulas please
each GD has a five year sssatsarity Now consider the surgery centers' goal of havine 3. $200,ooo available in five years to buy a new patient billing system. a. What lump sum amount must be invested today in a CD paying 1o percent annual interest to accumu- late the needed $2oo,ooo? b. What annual interest rate is needed to produce $200,00o after five years if only $100,00o is invested? Now consider a second alternative for accumulating funds to buy the new billing system. In lieu of a lump sum investment, assume that five annual payments of 32,000 are made at the end of each year. 4. What type of annuity is this? b. What is the present value of this annuity if the opportunity cost rate is 1o percent annually? o percent compounded semiannually? What is the future value of this annuity if the payments are invested in an account that pays 10 percent interest annually? 10 percent compounded semiannuallyStep by Step Solution
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