A Sinking Fund of $100 000 Is to Be Created

question 4

Essay

A sinking fund of $100 000 is to be created by equal annual payments at the beginning of each year for 12 years.Interest earned by the fund is 5.5% compounded annually.
a)Compute the annual deposit into the fund.
b)Construct a sinking fund schedule showing totals.

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Definitions:

Diffusion Of Responsibility

The phenomenon where individuals are less likely to take action or feel a sense of responsibility in the presence of a large group of people.

Pluralistic Ignorance

A phenomenon where individuals mistakenly believe their thoughts, feelings, or behaviors are different from those of the group, due to a lack of open communication.

Uncaring Attitude

describes a lack of interest or concern about something or someone, often perceived as indifference or emotional detachment.

Life Cycle

The series of stages that an entity (such as a product, organization, or project) goes through from initiation to its eventual termination or renewal.