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Using the future value (FV) formula below only, answering the following showing all work: FV(CF) = CF * (1+r) n Suppose you work for an
Using the future value (FV) formula below only, answering the following showing all work:
FV(CF) = CF * (1+r)n
- Suppose you work for an investment company. You are negotiating a 6-year loan of $1,000,000 made to Green Services Corporation. Green Services agrees to pay $50,000 at the end of Year 1, $100,000 at the end of Year 2, and a fixed payment at the end of each year from Year 3 through Year 6. Based on your analysis, you are confident Green Services will be able to make the promised payments, as Green Services' financials look healthy. Assume the annual interest rate will remain at 8% for the next 6 years. Determine the fixed amount Green Services will pay at the end of each of the final 4 years. (Draw a timeline and show your work.)
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