How much money would have to be placed in a sinking fund each year to replace a machine costing $20,000 today at the end of 10 years if the fund yields 9% annual interest rate compounded yearly and if the cost of the machine is assumed to increase at 5% annually for the next 10 years? Assume the salvage value is zero.
A) $2,143.63
B) $2150
C) $2,340
D) $1923

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The Answer of How much money would have to be placed in a sinking fund each year to replace a machine costing $20,000 today at the end of 10 years if the fund yields 9% annual interest rate compounded yearly and if the cost of the machine is assumed to increase at 5% annually for the next 10 years? Assume the salvage value is zero.
A) $2,143.63
B) $2150
C) $2,340
D) $1923

How Much Money Would Have to Be Placed in a Sinking