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Unformatted text preview: as: ? 6.8 , 0.5%,32 . And the equivalent of single payment for cash flows occurring after the period 32 can be computed as: ? 6.8 ( , 0.5%,15) . The summation of these two values can thus be used to compute the annual equivalent monthly payment for the periods from 20 to 32. (e) It is easier if the cash flows under the same interest rate are considered together. For example, consider the cash flows occurring after 20 periods. The value of the cash flow by the period 20 can be computed as: = ? 6.8 , 0.75%,27 . However, it should not be directly counted into the present value at the period 0; instead, it should be discounted through the periods with interest rate 0.50% and 0.25% (f) 0.25% 0.50% 0.75% 1 2 10 11 12 20 21 22 47...
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This note was uploaded on 01/11/2012 for the course EIN 4354 taught by Professor Tufecki during the Fall '08 term at University of Florida.
- Fall '08