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ziro4ka [17]
3 years ago
14

ABC Corp. wants to save $1,000,000 to buy some new equipment four years from now. The plan is to set aside an equal amount of mo

ney on the first day of each quarter starting today. The firm can earn an APR of 5.75 percent compounded monthly on its savings. How much does the firm have to save each quarter to achieve its goal
Business
1 answer:
FromTheMoon [43]3 years ago
6 0

In order to achieve its goal, the amount the firm should save each quarter is $56,033.97

The formula that can be used to determine the amount that the company should save every month to achieve its goal is :

Amount = future value / annuity factor

Annuity factor = \frac{(1 + r)^{n} - 1 }{r}

  • Future value = amount it wants to save in 4 years = $1 million
  • r = interest rate = 5.75% / 4 = 1.4375%
  • n = number of years = 4 x 4 = 16

Annuity factor = [(1 + 0.014375)^16 - 1] / 0.014375

= 17.846317

Amount = $1,000,000 / 17.846317

= $56,033.97

A similar question was answered here: brainly.com/question/14927086?referrer=searchResults

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Answer:

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In the United States, rent control laws were adopted during World War II when the country was experiencing a housing shortage. President Richard Nixon then passed the wage and price laws that influenced the modern rent control laws that are still being applied today. This is why most rent control laws usually apply to older properties built before 1980.

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