a) What is the present value of the following future receipt: $16,000 63 years from now at 10.5% compounded annually?
b) What is the accumulated value of series of payment of $ 250 at the end of each year for 25 years at 12.5% compounded annually?
c) It is estimated that a certain piece of equipment can save $6,000 per year in labor and material cost. The equipment has an expected life of five years and no salvage value. If the company must earn a 15% annual return on such investments, how much could be justified now for the purchase of this piece of equipment?