Question

To join an upscale country club, an individual must first purchase a membership bond for $20 comma 00020,000. In addition, monthly membership dues are $250250. Suppose an individual wants to put aside a lump sum of money now to pay for her basic country club membership expenses (including the $20 comma 00020,000 bond) over the next 3030 years. She can earn an APR of 66% compounded monthly on her investments. What amount must this person now commit to the membership? The person must now commit nothing to the membership (Ctrl) DE

Answer 1

Number of years 30 n> 12x30 - 360 Months Monthly membership dues - 1250 Ironterest rate 6%. Monthly interest rate is 6% 3 0.005 P- 20000 The present value of the amount Committed is P-ACCl + 1) Ci(1+i)n ) P= 250((1+0.005) 360 L 0.005(Ho.005) 3 p. 250/6.02257-1 (0.005* 6.02257 p= 250/5.02257 -0.03011 -250166.80737) : 41701.8425 over all amount- 20000+ 4+1701.84 61701.84 Com 8023 $20.000ft 256 (P/A, 0.6%,366) 20-000 + 250(166- 200004 41701.84 2 61701.84