Business Investments

Business investment
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As the owner of the business, Business goals can be achieved through the use of annuities for instance buying of end equipment. But, decisions involving finance require cautious. I this essay I will look at different investment decisions, and describe how one can use different investment vehicles to effectively accomplish business goals (Cleaves, C. et al., 2013).
In the future, I plan to expand my vinyl fence company. To achieve this goal, I must purchase a new warehouse facility. Before making any purchase, I will compare both annuities. Both options paying n interest of 8% and compounded quarterly for five years. In the budget, I am required to save $ 2,500 on each quarter.
Ordinary Annuity:
The periods of interest: 5 × 4= 20
Interest rate for the period: 0.084 = .02
20 years intersecting 2 % = 24.297
Expected future value = $ 2,500 × 24. 297 = $ 60,742.50
Amount of interest earned: $ 60,742.50 – $ 2,500 ×20 = $ 10,742.50
Interest earned:$ 10, 742.50
Annuity Due:
The periods of interest: 5 × 4= 20
Interest rate for the period: 0.084 = .02
20 years intersecting 2 % = 24.297
Expected future value: $ 2,500 24.2971+.02= $ 61,957.35
Amount of interest earned: $ 61,957.35 – $ 2,500 ×20 = $ 11, 957.35
Interest earned: $ 11, 957.35
Difference: $1,214.85
The only difference that exists between the two investments is th…