Question

To pay off a debt we must repay a capital of 5000 euros today, a capital of 5000 euros in 3 years and a capital of 5000 euros in 9 years. We agree to pay off the debt in a single installment in 6 years; How much will we have to pay if the annual compound rate is 4.25%?

148

likes
741 views

Answer to a math question To pay off a debt we must repay a capital of 5000 euros today, a capital of 5000 euros in 3 years and a capital of 5000 euros in 9 years. We agree to pay off the debt in a single installment in 6 years; How much will we have to pay if the annual compound rate is 4.25%?

Expert avatar
Nash
4.9
87 Answers
To find out how much we need to pay after 6 years with an annual compound rate of 4.25%, we need to calculate the future value of each payment and then add them up.

Step 1: Calculate the future value of €5000 paid in 6 years:
Future Value = Present Value * (1 + Rate)^N
Future Value = €5000 * (1 + 0.0425)^6

Step 2: Calculate the future value of €5000 paid in 3 years:
Future Value = €5000 * (1 + 0.0425)^3

Step 3: Calculate the future value of €5000 paid in 9 years:
Future Value = €5000 * (1 + 0.0425)^9

Step 4: Add up all future values to find the total amount to be paid:
Total = Future Value1 + Future Value2 + Future Value3

Now, let's calculate the total amount to be paid:

1. Future Value_1 = €5000 * (1 + 0.0425)^6

Future Value_1 = €5000 * (1.0425)^6 ≈ €5000 * 1.2882 = €6441

2. Future Value_2 = €5000 * (1 + 0.0425)^3

Future Value_2 = €5000 * (1.0425)^3 ≈ €5000 * 1.1301 = €5650.50

3. Future Value_3 = €5000 * (1 + 0.0425)^9

Future Value_3 = €5000 * (1.0425)^9 ≈ €5000 * 1.4350 = €7175

4. Total = Future Value_1 + Future Value_2 + Future Value_3

Total ≈ €6441 + €5650.50 + €7175 = €19266.50

Therefore, you will need to pay approximately €19266.50 after 6 years with an annual compound rate of 4.25%.

\boxed{Answer: €19266.50} - Total amount to be paid.

Frequently asked questions (FAQs)
What is the value of x in the equation 2x + 3 = 7?
+
Math question: Find the limit of (sin(x)-x)/(x^3) as x approaches 0.
+
What is the product of the sum of two numbers and the difference of the same two numbers?
+
New questions in Mathematics
a to the power of 2 minus 16 over a plus 4, what is the result?
Convert the following function from standard form to vertex form f(x) = x^2 + 7x - 1
The strength of Kefexin oral suspension is 100 mg/ml. Nora has been prescribed cefalexin at a dose of 50 mg/kg/day divided in two single doses. Nora weighs 14 kg. How many milliliters of solution for Nora should be given as a single dose?
a ferry travels 1/6 of the distance between two ports in 3/7 hour. The ferry travels at a constant rate. At this rate, what fraction of the distance between the two ports can the ferry travel in one hour.
431414-1*(11111-1)-4*(5*3)
A person who weighs 200 pounds on earth would weigh about 32 pounds on the moon. Find the weight of a person on earth who would weigh 15 pounds on the moon.
Calculate the equation of the tangent line ay=sin(x) cos⁡(x)en x=π/2
4.2x10^_6 convert to standard notation
1. Suppose we have a good whose quantity supplied changed from 100 to 120 units when the price increased from $10 to $12 per unit. Compute the price elasticity of supply using the midpoint method
Solve this mathematical problem if 3/5 of a roll of tape measures 2m. How long is the complete roll? Draw the diagram
A pair of die is thrown and the absolute difference of the two scores is recorded. What is the probability of the absolute difference being 4 or more?
Nice's central library building is considered one of the most original in the world, as it is a mix between a sculpture and a work of habitable architecture. It was called La Tête Carrée and is made up of part of a bust that supports a cube divided into five floors. It is known that the building has a total height of approximately 30 meters. It admits that the cubic part of the sculpture is parallel to the floor and has a volume of 2744 meters3 Calculate, in meters, the height of the bust that supports the cube. Displays all the calculations you made.
A bag has 4 green lollipops, 3 white lollipops, and 1 black lollipop. What is the probability of drawing a white lollipop?
Determine a general formula​ (or formulas) for the solution to the following equation.​ Then, determine the specific solutions​ (if any) on the interval [0,2π). cos30=0
Your grandfather has run a small high street pharmacy for 40 years. After much persuasion, he has agreed to open a digital store online. List 5 potential ways to improve sales and/or margins by having a digital pharmacy through the utilisation of historic or new sales data.
Let X be a discrete random variable such that E(X)=3 and V(X)=5. Let 𝑌 = 2𝑋^2 − 3𝑋. Determine E(Y).
7- A printing company found in its investigations that there were an average of 6 errors in 150-page prints. Based on this information, what is the probability of there being 48 errors in a 1200-page job?
Sally’s sales for last Sunday were $1,278. That was an increase of 6.5% over her sales for the previous Saturday. What were her sales for the previous Saturday?
Paola went on vacation for 15 days if it rained 20% of the days. How many days did it rain?
Mark is gluing a ribbon around the sides of a picture frame. The frame is 11 inches long and 7 includes wide. How much ribbon does Mark need?