Answer / kangchuentat

ACCOUNTING AND FINANCIAL ENGINEERING - ANSWER 34.18 : (a) Backward. (b) Let Equation 1 : y = 1 / (1 + r) ^ 1 + 1 / (1 + r) ^ 2 + ... + 1 / (1 + r) ^ n. Multiply Equation 1 with (1 + r) will produce Equation 2 : y (1 + r) = 1 + 1 / (1 + r) ^ 1 + ... + 1 / (1 + r) ^ (n - 1). (c) Equation 2 - Equation 1 will produce yr = 1 - 1 / (1 + r) ^ n, then y = [ 1 - 1 / (1 + r) ^ n ] / r. The answer is given by Kang Chuen Tat; PO Box 6263, Dandenong, Victoria VIC 3175, Australia; SMS +61405421706; chuentat@hotmail.com; http://kangchuentat.wordpress.com.

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