3. 1 2 3 4 15 7. EOY 20 8 9. 10 21 22 23 24 25 26 27 28 29 30 CF $300 A A3 As As Five deposits are made at the EO 2021-2025, as shown in the CF table above. The deposit amounts decease by 10% every e the itret rate is compounded annually what is the amount in the account at the end of 2030 6.
3. 1 2 3 4 15 7. EOY 20 8 9. 10 21 22 23 24 25 26 27 28 29 30 CF $300 A A3 As As Five deposits are made at the EO 2021-2025, as shown in the CF table above. The deposit amounts decease by 10% every e the itret rate is compounded annually what is the amount in the account at the end of 2030 6.
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:3.
1
2
3
4
7
26
EOY
8.
9
10
20
21
22
23
24
25
27
28
29
30
CF
$300 A2
Aa
As
?
Five deposits are made at the EOYS 2021-2025, as shown in the CF table above. The deposit amounts decrease by 10% every year. I the interest
rate is 6% compounded annually, what is the amount in the account at the end of 2030
Expert Solution
Step 1
The deposit value from EOY 21 to 25 decreases by 10%.
| 21 | 300 |
| 22 | 270 |
| 23 | 243 |
| 24 | 218.7 |
| 25 | 196.83 |
Using the compounding formula,
Amount =
For deposit $300 the maturity value in EOY 30,
Amount =
= 537
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