Question 1: Northwest Iron and Steel is considering getting involved in electronic commerce. A modest e-commerce package is available for $20,000. If a company rants to recover the cost in 2 years, what is the equivalent amount of new income that must be realized every 6 months, if the interest rate is 3% per quarter.
Question 2: Fieldsaver Technologies, a manufacturer of precision laboratory equipment, borrowed $2 Million to renovate one of its testing labs. The loan was repaid in 2 years through quarterly payments that increased by $50,000 each time. At an interest rate of 3% per quarter, what was the size of the first quarterly payment.