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Unformatted text preview: 1 7. Problem 1.29 A = $225,000; n = 3; i = 15% per year; F = ? 8. Problem 1.36 (a) F = ?; i = 8%; n = 10; A = $2000; P = $10,000 (b) A = ?; i = 12%; n = 30; P = $16,000; F = 0 (b) P = ?; i = 9%; n = 15; A = $1000; F = $700 9. For the compound interest case, ﬁnd the doubling period as a function of interest rate i and the doubling interest rate as a function of number of periods n . F = P (1 + i ) n Here F = 2 P ⇒ 2 P = P (1 + i ) n ⇒ 2 = (1 + i ) n Doubling interest rate: i = 2 1 n1 Doubling period: n = log 2 log(1+ i ) 10. Problem 1.39 Assuming down is negative: down arrow of $10,000 in year 0; up arrows in the amount of $3000 in years 1 thru 5; i = 10% per year; arrow in year 5 identiﬁed as ”F = ?” 2...
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This note was uploaded on 03/24/2011 for the course ISEN 302 taught by Professor Ko during the Spring '08 term at Texas A&M.
 Spring '08
 KO

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