OPG Is Required to Create a Sinking Fund of $8

question 32

Essay

OPG is required to create a sinking fund of $8.1 billion 80 years from the start of the plant by making equal deposits at the end of every month throughout the 50 years life of the Pickering plant.If the interest is compounded 7.2% monthly,what is the size of the monthly deposit into the fund?

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Definitions:

Daily Interest

Daily Interest calculates the amount of interest that accrues each day on a loan or investment, based on the principle and the annual interest rate, divided by the number of days in a year.

Financial Calculation

The process of using mathematical and statistical methods to analyze and assess financial data and scenarios.

Daily Interest

Interest calculated on a daily basis, typically used in various financial products and accounts.

Exponential Notation

A way of writing numbers that accommodates values too large or small for ordinary notation, using a base number raised to a power.