Engineering Economics Topic: Perpetuity A certain amount of investment was made annually for 10 years at an interest rate of 6%. On the 14th year, withdrawals of 10,000 per year can be made for 5 years and an infinite withdrawal of 5000 per year after. If the investment will stop at the 5th year, how much should be invested on the 5th year to get the same amount of withdrawals on the same period? All payments and withdrawals are made at the beginning of each year.
Engineering Economics Topic: Perpetuity A certain amount of investment was made annually for 10 years at an interest rate of 6%. On the 14th year, withdrawals of 10,000 per year can be made for 5 years and an infinite withdrawal of 5000 per year after. If the investment will stop at the 5th year, how much should be invested on the 5th year to get the same amount of withdrawals on the same period? All payments and withdrawals are made at the beginning of each year.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Topic: Perpetuity
A certain amount of investment was made annually for 10 years at an interest rate of 6%. On the 14th year, withdrawals of 10,000 per year can be made for 5 years and an infinite withdrawal of 5000 per year after. If the investment will stop at the 5th year, how much should be invested on the 5th year to get the same amount of withdrawals on the same period? All payments and withdrawals are made at the beginning of each year.
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