ou wish to have an investment that will bring about $50 000 in ten years, and the rate of return is 8% per annum. Required: a. In term of time value of money, what is the amount of $50,000 represent? b. How much do you need to invest now if the rate is compounded annually (to the nearest dollar)? c. If you have $50,000 now and put the sum into a bank account that pays 5% per year. How much will you have in 8 years if the rate is compounded semiannually, quarterly, monthly and daily (to the nearest dollar)?

ou wish to have an investment that will bring about $50 000 in ten years, and the rate of return is 8% per annum. Required: a. In term of time value of money, what is the amount of $50,000 represent? b. How much do you need to invest now if the rate is compounded annually (to the nearest dollar)? c. If you have $50,000 now and put the sum into a bank account that pays 5% per year. How much will you have in 8 years if the rate is compounded semiannually, quarterly, monthly and daily (to the nearest dollar)?

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 27P

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