Mr. Andrew wants to buy a house 10 years from now. The price of the property...

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Mr. Andrew wants to buy a house 10 years from now. The price ofthe property that he is intending to buy cost N$ 1.5 million now.The inflation per year is estimated to be 5.1%, 5.3%, 5.7%, 5%, and4.5% for the next five years and expected to remain at 4.4% for thenext five years. If Andrew starts an annuity savings scheme whichoffers an interest of 6% per annum, then to buy the house at theend of the 10th year, what amount of money that Mr. Andrew has tosave every month in the savings scheme? What will be the futurevalue of the property with respect to the inflation?

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Current Cost of property C 15 million 15 x 1000000 1500000i1 inflation for year 1 51 i2 inflation for year 2 53 i3 inflation for year 3 57 i4inflation for year 4 5 i5 inflation for year 5 45 i6 inflation per year for See Answer

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Mr. Andrew wants to buy a house 10 years from now. The price ofthe property that he is intending to buy cost N$ 1.5 million now.The inflation per year is estimated to be 5.1%, 5.3%, 5.7%, 5%, and4.5% for the next five years and expected to remain at 4.4% for thenext five years. If Andrew starts an annuity savings scheme whichoffers an interest of 6% per annum, then to buy the house at theend of the 10th year, what amount of money that Mr. Andrew has tosave every month in the savings scheme? What will be the futurevalue of the property with respect to the inflation?