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17 September, 23:32

Suppose you are the financial manager of the International Emirates University IEU. And you are requested at the end of the year 2020 to pay 30,000 as the building rent for the coming two years. Furthermore at the end of the year 2022 you are requested to renew the university working licenses with total amount of $ 50,000 for the coming two years. Also, at the end of the year 2023 you have to face withdraw of $80,000 to pay well-known fees to the head of university in Dubai. If you can earn 8% in your fund how much you should deposit by today to reach your goals, and to leave your balance zero after the last withdrawal?

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  1. 18 September, 02:16
    0
    So what this is is

    many words

    assuming year 0 is 2017

    so compound first thing till 2020, take out 30000

    the remaining is copmpounded til 2022, take out 50000

    remaining is compounded for 1 more year and that is equal to 80000

    so from 2017 to 2020, that is 5 years

    from 2020 to 2022 is 2 years

    from 2022 to 2023 is 1 year

    work backwards

    A=P (r+1) ^t

    last one

    A=80000

    P=?

    r=0.08

    t=1 year

    80000=P (1.08) ^1

    divide both sides by 1.08

    I would leave in fraction

    20000000/27=P

    now that is the remaining after paying 50000, after 2 years of compounding

    so

    50000 + (2000000/27) = P (1.08) ^2

    solve using math

    about

    106374=P

    now reverse back

    5 years

    paid 30000

    30000+106374=P (1.08) ^5

    solve using math

    92813.526=P

    round

    $92813.53

    put $92813.53 in the fund
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