Question 1 Answer saved Marked out of 100 A mining company i

Question 1 Answer saved Marked out of 1.00 A mining company is required to repair the environmental damage it has caused once it ceases operations. The company expects that it will need an amount of $29.2 million in ten year\'s time to carry out the rectification work. It will make equal monthly deposits into an investment account that earns interest at 6.7% pa. compounded monthly, beginning at the end of this month. How much should each deposit be? Flag question (Give you answer to the nearest cent, ignoring the dollar sign.) Answer:

Solution

1.A = P(1+r/n)^(nt)

^{where A =29.2 MILLION i.e 292000, r=6.7/100= 0.067, n=12, t=10}

^{A=292000(1+0.067/12)^(12(10))=569574.915}

^{i.e 56.96 million}

^2.  A = P(1+r/n)^(nt)

P=17770 ,r=8.8/100= 0.088, n=12, t=5

A=17770(1+0.088/12)^(12(5))= 27547.35

3. A = P(1+r/n)^(nt)

^{P=480, r=6.2/100= 0.062, n=12, t= 14}

^{A=480(1+0.062/12)^(12(14))=1140.88}