How much money would have to be placed in a sinking fund


How much money would have to be placed in a sinking fund each year to replace machine costing $10,000 today at the end of 14 years if the fund yields 11% annual interest rate compounded yearly and if the first cost of the machine is assumed to increase at a 6% annual compound rate? Assume the salvage value is zero.

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Financial Management: How much money would have to be placed in a sinking fund
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