A community wants to build a transfer station that has a capital cost of $3 million. To pay off the cost with equal annual payments over a 15-year period at an annual interest rate of 6.125%, what is the cost of each annual payment?
A community wants to build a transfer station that has a capital cost of $3 million. To pay off the cost with equal annual payments over a 15-year period at an annual interest rate of 6.125%, what is the cost of each annual payment? Cost of each annual payment will be $183,750 where A = Payment amount per period P = Initial principal (capital) r = Interest rate per period n = Total number of payments or periods Thus, A=3,000,000{0.06125(1.0625)15/1.062514 =$183,750
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ENVIRONMENTAL SCIENCE
OSHA ENV 5302
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