Answer:
Annual deposit= $37,714.37
Explanation:
Giving the following information:
The villa costs $500,000 today, and housing prices in Mexico are expected to increase by 6% per year. Manny and Irene want to make fifteen equal annual payments into an account, starting today, so there will be enough money to purchase the villa in fifteen years.
The account earns 10% per year.
First, we need to calculate the final value of the house with the following formula.
FV= PV*(1+i)^n
FV= 500,000*(1.06^15)=$1,198,279.1
Now, we can calculate the annual payments required:
FV= {A*[(1+i)^n-1]}/i
A= annual deposit
Isolating A:
A= (FV*i)/{[(1+i)^n]-1}
A= (1,198,279.1*0.10)/[(1.10^15)-1]
A= $37,714.37
So that the government earn more revenue .Few governments for exampe India people are still ready to pay high to consume alcohol and tobacco,So therefore Indian government charges high tax(not too high) so that the consumers doesn't decrease their consumption and increase the government revenues
to reduce the consumption .if taxes are high people might refuse to buy tobacco and alcohol thus reduces the consumption
A Common is my choice for this question. There are plenty of commercials advertising this.
