11. If $10,000 is invested today in an account of Faisal Islamic Bank of Egypt that earns interest at a rate of 12.5%, what is the value of the equal withdrawals that can be taken out of the account at the end of each of the next six years if the investor plans to deplete the account at the end of the time period? A. $2,466. B. $2,604. C. $2,750. 12. An investor is to receive a 15-year, $8,000 annuity, with the first payment to be received today. At an 11% discount rate, this annuity's worth today is closest to: A. $55,855. B. $57,527. C.$63,855.

11. If $10,000 is invested today in an account of Faisal Islamic Bank of Egypt that earns interest at a rate of 12.5%, what is the value of the equal withdrawals that can be taken out of the account at the end of each of the next six years if the investor plans to deplete the account at the end of the time period? A. $2,466. B. $2,604. C. $2,750. 12. An investor is to receive a 15-year, $8,000 annuity, with the first payment to be received today. At an 11% discount rate, this annuity's worth today is closest to: A. $55,855. B. $57,527. C.$63,855.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 8EB: You put $600 in the bank for 3 years at 15%. A. If Interest Is added at the end of the year, how...

See similar textbooks

Related questions

Q: If you deposit $500 in a bank account today that earns 3% interest and you deposit $20 per month…

A: The future value of a present sum of money after n periods is given by the formula Future…

Q: Q.2 You deposit 1000 each year in an account for 5 years. At the time of the last deposit, the bank…

A: The time value of the concept is used in calculating the rate of return earned by an investor from…

Q: nd inter

A: Note : As per our guidelines, we can only solve one question at once. Since, you haven't mentioned…

Q: How much money must be deposited at the end of each year in a savings account that pays 9% per year,…

A: Compounded annually means at the end of every year, interest shall be added back to the principal…

Q: A man deposited P5,000 in a bank at a rate of 10% per annum for 4months and 25days. Find the…

A: Simple interest is an interest calculated on the principal portion of a loan or original…

Q: If an investor intends to double $25,000 by investing in a bank that pays 7% interest per year,…

A: The time required to double the investment can be calculated by using the formula of future value .…

Q: Jane Smart plans to make the following deposits in an account towards cash purchase of a real estate…

A: The concept of money's time worth indicates that any sum of money is worth more currently as…

Q: 27. You hope to accumulate an account balance of $20,000 in 4 years by making a single deposit…

A: We need to calculate the amount to be deposited today - present value (PV)Future Value (FV) =…

Q: 1. The Lexington Property Development Company has a RM10,000 note receivable from a customer due in…

A: Present value is the value of an investment in today’s time. It helps to make decisions better.

Q: An Engineering firm deposits Kshs.1,000,000 into a bank that pays an interest of 5% per annum…

A: Future value = Present value * (1 + Interest rate)^number of years

Q: 2. (a) Your company is required to pay into a sinking fund each year in matures in 10 years. The…

A: Since you have asked multiple questions, we will solve the first question for you as per policy.…

Q: Use the following information to answer the next two questions: You deposited the following stream…

A: Future Value is the value of current investments at a certain future date at the assumed…

Q: If in your Allied Bank account you deposit Rs.15,000 at the end of each year at 14% interest rate…

A: The future value function or concept can be used to determine the future value of a present sum or…

Q: (Comprehensive problem) You would like to have $54,000 in 16 years. To accumulate this amount, you…

A: Future value = $54,000Period = 16 yearsInterest rate = 6% per annum

Q: 1. If you deposit OMR 32000 today in to a bank account that pays 4% interest compounded, how much…

A: 1. we need to calculate future value of OMR 32,000 after 5 years at 4% interest rate. so, future…

Q: What annual interest rate do you need to find in order for a deposit of $500 to grow to $1,685 in 13…

A: Compound interest is a financial concept that involves the calculation of interest not just on the…

Q: If you borrowed P 10,000.00 from a bank with 8% interest per annum, what is the total amount to be…

A: Future Value refers to the value of the current asset or investment or of cash flows at a specified…

Q: 2. How much would you need to have deposited in a bank account 10 years ago in order to have £80,000…

A: Information Provided: Future value = 80,000 Interest rate = 2% compounded continuously Term = 10…

Q: 17. You deposit $8,000 in a bank account today. You make another deposit of $14,000 into the account…

A: Bank deposit today = $8,000 Deposit on first year = $14,000 Deposit on second year = $10,000…

Q: A young executive deposits $100 at the end of each month for 8 years and then increases the…

A: Here, Monthly Deposit till 8 years is $100 Interest Rate is 7.2% Required Amount is $400,000…

Q: Suppose you receive $190 at the end of each year for the next three years. a. If the interest rate…

A: Present Value of annuity refers to the current value of all the series of payments or income at…

Q: If in your Allied Bank acqount you deposit Rs.15,000 at the end of each year at 14% interest rate…

A: The future value function or concept can be used to determine the future value of a present sum or…

Q: 9. A man borrowed 200,000.00 from a bank at 12% compounded monthly, which is payable monthly for 10…

A: Loan amount = 200,000 Interest rate = 12% Monthly interest rate (r) = 12%/12 = 1% First payment =…

Q: . If you want to borrow K150,000 which of the following banks should you select? Explain clearly…

A: When the lender lends a loan to the borrower, he charges a rate of interest on the borrowed amount.…

Q: If your bank pays you 1.4% interest and you deposit $800 today, what will be your balance in five…

A: Initial deposit (I) = $800Interest rate (r) = 0.014 or 1.4%Period (n) = 5 YearsBank balance in 5…

Q: A bank lends some money to a business. The business will pay the bank a single payment of $184,000…

A: A financial measurement that calculates the worth of a potential sum of money or stream of payments…

Q: A bank makes an amortizing loan of $200,000 with a maturity of 8 years and equal payments every…

Q: bank pays 6% interest per year, compounded quarterly. To what amount will a $5000 deposit grow if…

A: Interest expense is the periodic obligation of the borrower to pay a certain percentage of the…

Concept explainers

Cost of Credit

The cost of credit is an extra amount that the borrower has to pay besides the loan amount. These credit charges may vary from loan to loan. The cost of credit includes interest charges, maintenance charges, and arrangement charges. Some of the costs are mandatorily collected by the lender based on the loan amount and tenure of the loan. The cost of credit is also called finance charges of the credit.

Question

Video Video

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

Step 2

Step 3

Step 4 Question 12

Trending now

This is a popular solution!

Step by step

Solved in 4 steps with 4 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

You put $600 in the bank for 3 years at 15%. A. If Interest Is added at the end of the year, how much will you have in the bank after one year? Calculate the amount you will have in the bank at the end of year two and continue to calculate all the way to the end of the third year. B. Use the future value of $1 table In Appendix B and verify that your answer is correct.
You put $250 in the bank for S years at 12%. A. If interest is added at the end of the year, how much will you have in the bank after one year? Calculate the amount you will have in the bank at the end of year two and continue to calculate all the way to the end of the fifth year. B. Use the future value of $1 table in Appendix B and verity that your answer is correct.
A7 2. An investor has a projected surplus income of P 1000 per year which he plans to deposit in a bank which offers an interest of 18% per annum for time deposit of over 5years. Compute how much shall the investor collect at the end of 13years, assuming he never withdraw before the 13th YEAR? ANSWER = 4221,866.28
1.How much must you deposit in an account today so that you have a balance of $21,829 at the end of 10 years if interest on the account is 10% p.a., but with quarterly compounding? Round your answer to 2 decimal places; record your answer without commas and without a dollar sign. 2. The Milken Company is offering you an investment that promises you $10,000 at the end of 15 years if you invest $ 5,889 today. What is the annual return on this investment? Compute your answer as a percent rounded to 2 decimal places. Record without a percent sign. For example, record .0848765 = 8.48765% as 8.49.
9. A man borrowed 200,000.00 from a bank at 12% compounded monthly, which is payable monthly for 10 years. If the first payment is to be made after 3 months, how much is the monthly payment? a. 3010.50 b. 2,927.10 c. 3,050.40 d. 2,867.30
Suppose you invest $3,800 today in an account that earns a nominal annual rate (inom) of 12 percent, with interest compounded quarterly. How much money will you have after 12 years? a. $5,417.89 b. $15,702.56 c. $14,804.71 d. $875,484.95 e. $51,072.00
please help with this Q
What is the future value of $100 invested in an account for eight years that earns 10% annual interest, compounded semiannually (rounded to the nearest whole dollar)? a. $214.b. $216.c. $218.d. $220.
please help with this Q
At the end of two years, what will be the balance in a savings account paying 6% annually if $10,000 is deposited today? The future value of one at 6% for one period is 1.06. a. $10,000 b. $10,600 c. $11,200 d. $11,236
2. Assume that you can invest to earn a stated annual rate of return of 12 percent, but where interest is compounded semiannually. If you make 20 consecutive semiannual deposits of $500 each, with the first deposit being made today, what will your balance be at the end of Year 20? $57,900.83 $58,988.19 O $52,821.19 O $64,131.50 O $62,527.47
Use Table 12-1 to solve. Suppose a certain manufacturer deposits $7,000 at the beginning of each 3 month period for 8 years in an account paying 8% interest compounded quarterly. (Round your answers to the nearest cent.) (a) How much (in $) will be in the account at the end of the 8 year period? (b) What is the total amount (in $) of interest earned in this account?