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Cost Benefit Analysis - SPS Corporation wants to invest $500,000.00 for a fleet of trucks to...

Cost Benefit Analysis - SPS Corporation wants to invest $500,000.00 for a fleet of trucks to be purchased in ten years. If SPS can get 4% per year. How much should be invested annually?

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Answer #1

Amount = $ 500,000

Interest rate = 4% per year

Time = 10 years

The future value = $ 500,000

Assume the firm invests $ A per year

Amount that has to be invested annually to accumulate $ 500,000 is = $ 41,645 (Approximately)

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