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Astros Co wanted to accumulate $3,650,000 by 2/1/20. To achieve that goal, Astros Co made the first of 6 equal annual deposits on 2/1/13. The deposits were placed into a fund that earns interest at 5%.

On 2/1/18, after making the 6th deposit (as determined above), Astros Co discovers that the amount needed has changed to $4,950,000, but that the $4,950,000 will not be needed until 2/1/24. So, Astros Co has decided that in order to achieve the desired total, a single deposit will be made to the fund on 2/1/21.

1) Determine the following items:

a) the amount of the deposit into the fund on 2/1/13. =486,725

b) the balance of the fund at 2/1/15, immediately after the 3rd deposit was made. =1,534,401

c) the balance of the fund at 2/1/21, immediately before the final deposit is to be made. =3,832,519

d) the amount of interest that will be earned from 2/1/15 through 2/1/21. =837,943

e) the balance of the fund on 2/1/21, immediately after the final deposit is to be made. =4,276,008

f) the amount of the final deposit, to be made on 2/1/21. =443,489

?Can you please explain how the answers are calculated

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M92797185

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