QUESTION:

(a) How much should Afram Plains Farms ltd. invest now to get GH 89,506 in 5 years time to expand its operations if the interest rate is 12.9%?

(b) If the firm decides to make 10 annual payments in order to have GH 89,506, how much should it invest each year if the interest rate is still the same as (a).

(c) Assume instead that the firm obtains the capital as a loan of GH 89,506 to be paid in 10 years with same interest rate. Develop an amortization schedule for the first 5 years.