Results 1 to 4 of 4

Math Help - Total Rent Amount when there is an annual growth rate for rent

  1. #1
    Member
    Joined
    Jan 2009
    From
    Punjab, Pakistan
    Posts
    88

    Total Rent Amount when there is an annual growth rate for rent

    Say the monthly rent is $1000 and terms of the rent state that there is an annual increase in rent for 5%. If I were to find the total rent paid in 5 years, how would I do that

    I at first tried using FVIFGA, future value interest factor of growing annuity where I used an interest rate of 0% a growth rate of 5% and for 5 period that did not work out

    Can anyone here help me out with this one please ?
    Follow Math Help Forum on Facebook and Google+

  2. #2
    MHF Contributor
    Joined
    Dec 2007
    From
    Ottawa, Canada
    Posts
    3,102
    Thanks
    68

    Re: Total Rent Amount when there is an annual growth rate for rent

    12000*(1.05^0 + 1.05^1 + 1.05^2 + 1.05^3 + 1.05^4) = 66307.575.....

    Another way:
    12 * [(1000*1.05^5 - 1000*1.05^0) / .05]
    Follow Math Help Forum on Facebook and Google+

  3. #3
    Member
    Joined
    Jan 2009
    From
    Punjab, Pakistan
    Posts
    88

    Re: Total Rent Amount when there is an annual growth rate for rent

    Quote Originally Posted by Wilmer View Post
    12000*(1.05^0 + 1.05^1 + 1.05^2 + 1.05^3 + 1.05^4) = 66307.575.....

    Another way:
    12 * [(1000*1.05^5 - 1000*1.05^0) / .05]
    Hey Wilmer, How in the world do you come up with these formulae
    Do you teach Business Math some place
    Are you an accountant
    Follow Math Help Forum on Facebook and Google+

  4. #4
    MHF Contributor
    Joined
    Dec 2007
    From
    Ottawa, Canada
    Posts
    3,102
    Thanks
    68

    Re: Total Rent Amount when there is an annual growth rate for rent

    Quote Originally Posted by dexteronline View Post
    Hey Wilmer, How in the world do you come up with these formulae
    Do you teach Business Math some place
    Are you an accountant
    I'm a retired financial analyst; hence worked quite a bit with financial formulae.
    By the way, these are really fairly easy/simple...I ain't no guru!
    Follow Math Help Forum on Facebook and Google+

Similar Math Help Forum Discussions

  1. Replies: 15
    Last Post: December 29th 2010, 09:34 AM
  2. Replies: 2
    Last Post: October 15th 2009, 06:06 AM
  3. annual proportionate growth rate
    Posted in the Differential Equations Forum
    Replies: 0
    Last Post: May 5th 2009, 10:04 AM
  4. Annual Percentage Growth Rate
    Posted in the Business Math Forum
    Replies: 4
    Last Post: August 1st 2008, 06:10 AM
  5. growth rate and annual yield
    Posted in the Pre-Calculus Forum
    Replies: 2
    Last Post: September 21st 2007, 10:47 AM

Search Tags


/mathhelpforum @mathhelpforum