A City Borrows $1 Million,paying Semi-Annual Interest at J₂ =

question 13

Multiple Choice

A city borrows $1 million,paying semi-annual interest at j₂ = 6%.The city creates a sinking fund in which semi-annual deposits of $35,360.93 are made in order to accumulate the $1 million needed to repay the loan upon maturity.The sinking fund ends earns j₂ = 7%.You are given that the book value of the debt immediately after the 12^th payment is $483,661.06.How much has been accumulated in the sinking fund immediately after the 13^th deposit of $35,360.93?

• A)$516,338.94
• B)$534,410.81
• C)$535,950.12
• D)$569,771.73

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Definitions:

Milling Machine

A machine tool used to machine solid materials, typically by cutting, boring, drilling, or threading.

Raw Materials

Basic substances in their natural, modified, or semi-processed states used as inputs for manufacturing finished goods.

Labour

The effort exerted by humans, encompassing both physical and mental activities, in the creation of goods and services.

Cost Structure

The composition of a company's costs, including fixed and variable costs, that determines how it spends money on its operations.