Question

Consider an asset that you purchase for $40,000. It's nomimal resale value after five years of ownership is $5,000. At that time you plan to sell it and move to an ashram in India. What is the annuity or levelized cost payment that has the same net present cost to you of holding this asset if the nominal discount rate is 5%? The annuity factor is given as $\left(\frac{1-\frac{1}{(1+i)^T}}{i}\right) = \left(\frac{1-\frac{1}{(1.05)^5}}{.05}\right) =$ 4.33 $10,120.41 $8,334.12 $35,886.5 $3,464.62

          Consider an asset that you purchase for $40,000. It's nomimal resale value after five years of
ownership is $5,000. At that time you plan to sell it and move to an ashram in India. What is the
annuity or levelized cost payment that has the same net present cost to you of holding this asset if
the nominal discount rate is 5%? The annuity factor is given as $\left(\frac{1-\frac{1}{(1+i)^T}}{i}\right) = \left(\frac{1-\frac{1}{(1.05)^5}}{.05}\right) =$
4.33
$10,120.41
$8,334.12
$35,886.5
$3,464.62

$Consider an asset that you purchase for 40,000. It's nomimal resale value after five years of ownership is5,000. At that time you plan to sell it and move to an ashram in India. What is the annuity or levelized cost payment that has the same net present cost to you of holding this asset if the nominal discount rate is 5%? The annuity factor is given as $\left(\frac{1-\frac{1}{(1+i)^T}}{i}\right) = \left(\frac{1-\frac{1}{(1.05)^5}}{.05}\right) =$ 4.33 10,120.418,334.12 35,886.53,464.62$

Added by Lisa S.

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