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IAI Nov 2005 Q20 (i)

Discussion in 'CT2' started by Srijana Raghunath, Aug 30, 2017.

  1. Srijana Raghunath

    Srijana Raghunath Member

    In solution, the annual cost of the new machine is calculated by

    10 Crore/ 5.650223 = 1.77 Crore

    Where does 5.650223 come from?
    Discount rate is given as 12%.
     
    Srijana Raghunath, Aug 30, 2017
    #1
  2. Lynn Birchall

    Lynn Birchall ActEd Tutor Staff Member

    It looks like the 5.650223 is a 10-year annuity certain factor (payable annually in arrears) calculated at 12%.
     
    Lynn Birchall, Aug 30, 2017
    #2
  3. Srijana Raghunath

    Srijana Raghunath Member




    Ok..thank you.
     
    Srijana Raghunath, Sep 2, 2017
    #3

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