Your future company has purchased a machine and has entered into a contract that requires the company to pay $2000 each year for the upgrade of machine components at the end of years 6, 7, and 8. In anticipation of the upgrade cost, your company has decided to deposit equal mounts (X) at the end of each year for 5 years in a row in an account that pays i = 6%. The first deposit is made at the end of the first year. What is the value of X?
What will be an ideal response?
2000 (F/A, 6%, 3) = X (F/A, 6%, 5)(F/P, 6%, 3)
X = $948.37
Trades & Technology
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