1. You want to accumulate $77,961 for a down payment on a small business. You will invest $39,000 today in a bank account paying 8% interest compounded annually. Approximate how long will it take you to reach this goal? 2. The Jasmine Tea Company purchased merchandise from a supplier for $46,676. Paymen was a noninterest-bearing note requiring Jasmine to make five annual payments of $12,0 beginning one year from the date of purchase. What is the interest rate implicit in this agreement? 3. You borrowed $21,000 from a friend and promised to pay the loan in 10 equal annual installments beginning one year from the date of the lean Your friend would like to be
1. You want to accumulate $77,961 for a down payment on a small business. You will invest $39,000 today in a bank account paying 8% interest compounded annually. Approximate how long will it take you to reach this goal? 2. The Jasmine Tea Company purchased merchandise from a supplier for $46,676. Paymen was a noninterest-bearing note requiring Jasmine to make five annual payments of $12,0 beginning one year from the date of purchase. What is the interest rate implicit in this agreement? 3. You borrowed $21,000 from a friend and promised to pay the loan in 10 equal annual installments beginning one year from the date of the lean Your friend would like to be
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:The following situations should be considered independently.
1. You want to accumulate $77,961 for a down payment on a small business. You will invest
$39,000 today in a bank account paying 8% interest compounded annually. Approximately
how long will it take you to reach this goal?
2. The Jasmine Tea Company purchased merchandise from a supplier for $46,676. Payment
was a noninterest-bearing note requiring Jasmine to make five annual payments of $12,000
beginning one year from the date of purchase. What is the interest rate implicit in this
agreement?
3. You borrowed $21,000 from a friend and promised to pay the loan in 10 equal annual
installments beginning one year from the date of the loan. Your friend would like to be
reimbursed for the time value of money at a 9% annual rate. What is the annual payment
you must make to pay back your friend?
Note: For all requirements, Use tables, Excel, or a financial calculator. (FV of $1, PV of $1, FVA
of $1, PVA of $1, FVAD of $1 and PVAD of $1)
Complete this question by entering your answers in the tabs below.
Required 1
Required 2 Required 3
You want to accumulate $77,961 for a down payment on a small business. You will invest $39,000 tod
paying 8% interest compounded annually. Approximately how long will it take you to reach this goal?
Note: Do not round intermediate calculations. Round the value of "n" to the nearest whole number.
Present Value:
Future Value
n =
i=
< Required 1
Required 2 >
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