Suppose that $1,000 is invested quarterly at 6% interest, compounded quarterly. How much will be in the account after five years? A) $5,637 B) $5,152 $23,124 D) $43.20
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- A woman deposits $9000 at the end of each year for 10 years in an account paying 3% interest compounded annually. (a) Find the final amount she will have on deposit. (b) Her brother-in-law works in a bank that pays 2% compounded annually. If she deposits money in this bank instead of the other one, how much will she have in her account? (c) How much would she lose over 10 years by using her brother-in-law's bank?Suppose that $5,000 is placed in a bank account at the end of each quarter over the next 9 years. What is the future worth at the end of 9 years when the interest rate is 14 compounded at the given intervals? (a) Quarterly (b) Monthly (c) ContinuouslyMake the following flow DIAGRAM: -50,000 - 1,000 (P/A, 6%, 2) (P / F, 6%, 1) + 5,000 (P / A, 6%, 4) (P / F, 6%, 3) -2,000 (P / F, 6%, 5)
- Compute the present worth (P) for the cash flows with the different periodicinterest rates specified. The cash flows occur at the end of each year over sixyears.(a) P = $2,140(b) p = $2,154(c) P = $2,234( d) p = $2,249Suppose you take out a car loan of $15,000 with an interest rate of 15% compounded monthly. You will pay off the loan over 36 months with equal monthly payments.(a) What is the monthly interest rate?(b) What is the amount of the equal monthly payment?(c) What is the interest payment for the 15th payment?(d) What is the total interest paid over the life of the loan?Problem 1. Find the maturity value of the following simple interest investments. (i) $3125 invested at 2.85% for 7 months. (ii) $12,000 at 5.3% for 11 months. Problem 2. Find the future value of the following investments. (i) $15,000 iinvested at 6% compounded monthly for 10 years. (ii) $8500 at 6.9% compounded quarterly for 5 years. Problem 3. Find the effective rate corresponding to each nomianal rate. (i) 6% compounded quarterly. (ii) 7.25% compounded semiannually. Problem 4. Find the amount needed to be invested now to accumulate the following amount if the money is compounded as indicated. (i) $2000 at 7% compounded semiannually for 8 years. (ii) $8800 at 5% compounded quarterly for 5 years. Problem 5. Find the interest rate for each deposit and compound amount. $8000 accumulating to $11,672.12 compounded quarterly for 8 years. (ii) $6725 accumulating to $10,353.47 compounded monthly for 7 years. Problem 6. Find the time required for each initial amount to be at least equal to the…
- Finance. Suppose that $2,300 is invested at 5% annual interest rate, compounded monthly. How much money will be in the account in (A) 8 months? (B) 16 years? (A) Amount after 8 months: $ (Round to the nearest cent.) (B) Amount after 16 years: S (Round to the nearest cent.)How much money would you need to deposit today at 9% annual interest compounded monthly to have $12000 in the account after 6 years? A) $7,007 B) $20,550 $20,125 D) $7,155M purchased a small lot in a subdivision. paying P200 000 down and promising to pay P15 000 every 3 months for the next 10 years. The seller figured interest at 12% compounded quarterly. (a) What was the cash price of the lot? (b) If M missed the first 12 payments what must he pay at the time the 13th is due to bring himself up to date? (c) After making 8 payments. M wished to discharge his remaining indebtedness by a single payment at the time when the 9th regular payment was due what must he pay in addition to the regular payment then due? (d) If M missed the first 10 payments what must he pay when the 11th payment is due to discharge his entire indebtedness?
- A set of cash flows begins at $20,000 the first year, with a decrease each year until n = 10 years. If the interest rate is 7%, what is the present value when (a) the annual decrease is $2000? (b) the annual decrease is 10%?ANSWER LETTER D ONLY M purchased a small lot in a subdivision, paying P200,000 down and promising to pay P15.000 every 3 months for the next 10 years. The seller figured interest at 12% compounded quarterly. (a)What was the cash price of the lot? (b) If M missed the first 12 payments , what must he pay at the time the 13th is due to bring himself up to date? (c) After making 8 payments, M wished to discharge his remaining indebtedness by a single payment at the time when the 9th regular payment was due, what must he pay in addition to the regular payment then due? (d) If M missed the first 10 payments, what must he pay when the 11th payment is due to discharge his entire indebtedness?As part of your retirement plan, you have decided to deposit $9,000 at the beginning of each year into an account paying 3% interest compounded annually. (Round your answers to the nearest cent.). (a) How much (in $) would the account be worth after 10 years? $ (b) How much (in $) would the account be worth after 20 years? $ (c) When you retire in 30 years, what will be the total worth (in $) of the account? $ (d) If you found a bank that paid 6% interest compounded annually rather than 3%, how much (in $) would you have in the account after 30 years? $ (e) Use the future value of an annuity due formula to calculate how much (in $) you would have in the account after 30 years if the bank in part (d) switched from annual compounding to monthly compounding and you deposited $750 at the beginning of each month instead of $9,000 at the beginning of each year. $