Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. question 2: the time value of money 2.1. estimat

QUESTION 2: The time value of money 2.1. Estimate the future price of...

60.1K

Verified Solution

Question

Accounting

QUESTION 2: The time value of money
2.1. Estimate the future price of a dump truck. The current price is R105000. What will the likely price be in 5 years' time if the price is likely to increase at an annual rate of 12%?
2.2. Assume that you deposit R5000 today and R8000, R10000, is deposited respectively, two years, and four years from now. At a 9% interest rate compounded annually.
2.2.1. Illustrate with the aid of a fully labelled cash flow diagram the cash flow through year 6.
2.2.2. Determine the future value at the end of year 6.
2.3. If an interest rate of 6.5% per year is applied, how long will it take your investment of R25,000 to grow to R38849.66?
image

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students