3.A financial institution offers a nominal interest rate of 12% while compounding itsaccounts quarterly.a.b.DWhat is the effective interest rate?For how many years must quarterly deposits of $1,000 be made into thisaccount so that $100,000 will be accumulated at the end of this time?A retail outlet is being designed in a strip mall in Nebraska. For this outlet, theinstalled fiberglass insulation to protect against heat loss in the winter and heat gain in thesummer will cost an estimated $100,000. The annual savings in energy due to the insulation willbe $18,000 at EOY one in the 10-year life of the outlet, and these savings will increase by 12%each year thereafter. If the annual interest rate is 15%, is the cost of the proposed amount ofinsulation justified?

Effective Interest Rate: It refers to the annual rate of interest provided the effects of…

3. A financial institution offers a nominal interest rate of 12% while compounding its accounts quarterly. a. What is the effective interest rate? = b. For how many years must quarterly deposits of $1,000 be made into this account so that $100,000 will be accumulated at the end of this time?

3. A financial institution offers a nominal interest rate of 12% while compounding its accounts quarterly. a. What is the effective interest rate? = b. For how many years must quarterly deposits of $1,000 be made into this account so that $100,000 will be accumulated at the end of this time?

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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Suppose that at the end of each week for 30 years, $100 is deposited into an account that earns 6.8% annual interest, compounded weekly. (a) Find the total value in the account after the 30 years. (b) What is the total amount of the payments over the 30 years? (c) What is the total amount of interest earned over the 30 years?
Finance. Suppose that $4,000 is invested at 4.6% annual interest rate, compounded monthly. How much money will be in the account in (A) 6 months? (B) 6 years? (A) Amount after 6 months: $ (Round to the nearest cent.)
3. 4. How much interest on interest is earned in an account by the end of 5 years if $100,000 is deposited and interest is 4% per year, compounded continuously? How much will be in an account at the end of five years the amount deposited today is $10,000 and interest is 8% per year, compounded semi-annually? Complete the following, solving for the present value, PV: Case A B C Future value $10,000 $563,000 $5,000 Interest Number of rate periods 5% 5 4% 5.5% 20 3 Present value
Give me answer fast all questions please...
14 If $1,000 is invested in an account that pays 3% interest compounded annually, the total amount A(t) in the account after t years is: A(t)-1000(1.03) Find the average rate of change per year of the total amount in the account for the first five years: type your answer..... Find the average rate of change per year of the total amount in the account for the second five years (from t - 5 tot - 10): type your answer... Enter numbers rounded to two decimal places.
Accounting What is the value of the following payment stream 1 year from now, at a simple interest rate of 4.4%. $10,000 3-years ago, $6,000 1.25 years ago, $12,000 due in 3 years, $18,000 due in 5 years. What is the value of the payment stream at the focal date?
a. What amount could be withdrawn at t=10? b. What uniform annual series deposits (n=10) would result in the same accumulated balance at the end of year 10?
What is the nominal annual rate of interest compound monthly at which $1530.00 will accumulate to $1936.69 in two years and eleven months? Give the nominal annual rate of interest in percentage. Need only handwritten solution only (not typed one).
A deposit of $1000 compounds to $2500 in 5 years. The interest on this account compounds quarterly. What is the closest nominal annual rate of return? (a) 2.50% (b) 4.70% (c) 18.75% (d) 20.11%
1. Suppose that a loan of $9,000 is given at an interest rate of 2% compounded each year. Assume that no payments are made on the loan. Follow the instructions below. Do not do any rounding. (a.) Find the amount owed at the end of 1 year. $_____?(b.) Find the amount owed at the end of 2 years. $_____? 2. If the rate of inflation is 2.5% per year, the future price p(t) (in dollars) of a certain item can be modeled by the following exponential function, where t is the number of years from today. p(t)=2000(1.025)t Find the current price of the item and the price 10 years from today. (Roud your answers to the nearest dollar as necessary.) Current Price: $_____?Price 10 years from today: $_____?
1.5 Suppose you would like to retire in 15 years. To save for retirement, you deposit an amount A into the bank at the beginning of the next 180 months. After that period, you would like to withdraw $1,000 at the beginning of the following 300 months. Assume a nominal yearly rate of 7.5% compounded monthly. What amount does A have to be?
Suppose that $4500 is invested in an account that pays 2% annually and is left for 4 years. 1) How much will be in the account if interest is compunded quarterly? 2) How much will be in the account if interest is compouded continuously?

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