Answer:
$2,274,639.75
Explanation:
The endowment as of July 2010 was $15,000,000
Endowment value by July 2014 = $15,000,000 (1+0.05)^4 - Facility expenditures
= $15,000,000 (1.2155) - $5,000,000
= $18,232,500 - $5,000,000
= $13,232,500
Funds reserved for operational expenses = $250,000/0.05 = $5,000,000
Available funds for capital replacement = $13,232,500 - $5,000,000 = $8,232,500
Effective interest rate over 5 years = (1+0.05)^5 - 1 = 0.2763
Annual capital replacement funds every fifth year indefinitely = $8,232,500 (0.2763) = $2,274,639.75