Ceo ee Factor Factor by Which to Fores To Find Given Multiply “Given” Factor Name Symbol A) Forsingle cash lows: : 0 Single paymen fo = FR deo ape Eun (F/P,i%.N) @rep = Ff xX ipeolieiiny (P/F, i%.N) L) For uniform series (annuities) x air Uniform series @r at eer ay BLAM } Uniform ser Pe ed OS iF present worth (P/A,i%,N) ®s = iTreaPeT, Sinking fund (A/F, i%,N) iso" Qa = px eS €apital recovery (AIP. #%,N) Daan gregh Na Eda CAnnual BGuivalent) det)Interest Formulas and Their Applications EXAMPLE A personis planning for his rtied life. He has 10 more years ‘of service, He would like to deposit 20% of his salary, which is € 4,000, atthe fend of the first year, and thereafter he wishes to deposit the amount ‘with an annual increase of & S00 for the next 9 years with an intrest riié of 15%, Find the total amount atthe end of the 10th year of the above series. Solution Here, 4000 G=T500 15% 10 years A=T&F ‘The cash flow diagram is shown in Fig. 3.13. = 0 ale 4000's 500 ee 2a ‘000 +1500 4000+ 4500 Fig. 223 Cash flow diagram of uniform gradient series annual equivalent amount asa +i 1+ GUNG, i.) = 4,000 + S00(A/G, 15%, 10) 0100 + 500 x 3.3832 5691.60 146 = A(FTA, 15%, 10) 5,691,60(20.308) =F 115,562.25 ‘At the end of the 10th year, the compound amount of all is payments will be © 115,562.35.