Saturday, August 16, 2008
A Fool and his money
My first thought was "I don't think so." My second thought was "says who?" My third thought was "didn't you have to learn this sort of stuff back at State U?"
Well, yes. I did have to learn that, back in the (surprisingly interesting ) Engineering Economics class. The calculation is pretty straight forward, and not too much different than calculating a mortgage. The input assumptions are the key.
So let's start with the $3,951.78 value as a starting point. If we convert this to a monthly income, with 3% interest rate, 5 year term, and zero value at the end of 5 years, Excel says that this works out as $71.01 a month (it's the PMT function).
So, a different way to look at it: is this corner of the Internet worth $71 a month? Beats me. That works out to around 76¢ a post.
Since this line of thought seems to be going nowhere, let me just say that I accept cash and personal checks.