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The Gulf Tourism Company purchased a building for its offices at the end of the year, at a value of 85,000 riyals, and paid 24 percent of the value as a down payment, provided that the remaining amount is paid in fifteen equal annual payments. It includes the principal and 10 percent compound interest on the remaining balance. demanded. . 1 What is the amount of the annual payment that the company must pay when the required interest rate is 5% 20%, 15%, 10% or 25%? Compare the annual payment for each interest rate and select the best rate To reduce financing costs, giving reasons. . 2 What is the amount required to be paid at the end of the period if the company decides to pay the remaining amount on: a. 5 payments with 25% interest B. 15 Payment with 10% interest C 10. 5% interest payments d 8 payments with an interest rate of .20% e. 12 installments with 12% interest Compare the amounts to be paid at the end of the period and select the least costly financing decision for the company. . 3 You need an amount of Rial 129,200 after 17 years. A - What annual payment should be placed in a savings account in the bank that pays 9 percent interest annually? b If you want to place one lot only now and wait for it to increase in value at a rate of 9 percent per year to reach Amount Required After seventeen years, what is the value of this payment?

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