Answer : $4938.80
A sinking fund is a term that can be broadly used to describe putting a fixed amount of money aside at regular intervals for a given time frame and investing this money at a given interest rate with an objective of saving a desired amount of money at the end of the time period.
In finance it's referred to commonly as an annuity payment.
For this question, we can use the formula for Future Value of an annuity to arrive at the answer.
![FVA = P\left [ \frac{(1+r)^{n}-1}{r}\right ]](https://tex.z-dn.net/?f=%20FVA%20%3D%20P%5Cleft%20%5B%20%5Cfrac%7B%281%2Br%29%5E%7Bn%7D-1%7D%7Br%7D%5Cright%20%5D%20%20)
where
FVA = future Value of an annuity
P = periodic payment
r = interest rate per period
n = number of periods
The following information is given in the question:
FV = $120,000
Interest Rate = 8% p.a
No. of years = 5 years
No. of compounding periods in a year = 4
So,
i =0.02
n = 20 ( 5 * 4)
Substituting these values in the FVA equation, we have
![120000 = P\left [ \frac{(1+0.2)^{20}-1}{0.02}\right ]](https://tex.z-dn.net/?f=%20120000%20%3D%20P%5Cleft%20%5B%20%5Cfrac%7B%281%2B0.2%29%5E%7B20%7D-1%7D%7B0.02%7D%5Cright%20%5D%20)
![120000 = P\left [ \frac{0.485947396}{0.02}\right]](https://tex.z-dn.net/?f=%20120000%20%3D%20P%5Cleft%20%5B%20%5Cfrac%7B0.485947396%7D%7B0.02%7D%5Cright%5D%20)
.
a. plus $5,063 was the total adjustment.
The definition of adjustment is the act of creating an alternate or is the exchange that is turned into made. An instance of an adjustment is the time that it takes for someone to end up comfy living with someone else. The settlement of ways tons is to be paid in cases of loss or declaration, as with the aid of insurance. a way of fixing.
A pay adjustment is a change in a worker's pay fee. you could exchange an employee's hourly salary or profits. Normally, reimbursement adjustment is a boom within the pay charge, which includes when an employee earns a raise.
Aadjustments to income encompass such items as Educator charges, scholar mortgage hobby, Alimony bills, or contributions to a retirement account. Your AGI will by no means be more than your Gross general earnings on you come back and in a few cases may be decreased.
Your question is incomplete. Please find the complete question below.
A comparable property showed an adjusted value of $40,000. The property sold two years ago, and the adjustments indicated a 7% annual appreciation rate. Assuming the
appreciation was the only adjustment, how much was the total adjustment?
a. plus $5,063
b. plus $5,404
c. minus $5,063
d. plus $5,600
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Answer:
$118.83 per month that Zach must save.
Explanation:
This is a future value annuity as we know the cruise will cost $16500 in 4 years time as estimated by Zach for the cruise.
Fv is the future value for the annuity which is $16500
we also have i the interest rate which is 3.99% monthly
n is the number of periods in which the monthly amount is saved 4 x 12 =48
now we will substitute to the following formula and solve for C the monthly payments that Zach saves for the cruise:
Fv =C [((1+i)^n -1)/ i] now we substitute
$16500 = C[((1+3.99%)^48 -1)/3.99%)] then solve for C
$16500/[(1+3.99%)^48 -1)/3.99%] = C
C = $118.83 that Zach must save per month for 4 years to afford the cruise.
