37. Calculate the present value of an ordinary annuity of $3,750 to be received each year for eight years, assuming an opportunity cost of 3 percent per year. 38. A generous philanthropist plans to make a one-time endowment to a renowned heart research center which would provide the facility with $85,000 per year into perpetuity. The rato of interest is expected to be 4.5 percent annually. How large must the endowment be? 39. James plans to fund his individual retirement account, beginning today, with an annual deposit of $2,000, which he will continue for the next 20 years. If he can earn an annual compound rate of 3 percent on his deposits, calculate the amount in the account upon his retirement.

37. Calculate the present value of an ordinary annuity of $3,750 to be received each year for eight years, assuming an opportunity cost of 3 percent per year. 38. A generous philanthropist plans to make a one-time endowment to a renowned heart research center which would provide the facility with $85,000 per year into perpetuity. The rato of interest is expected to be 4.5 percent annually. How large must the endowment be? 39. James plans to fund his individual retirement account, beginning today, with an annual deposit of $2,000, which he will continue for the next 20 years. If he can earn an annual compound rate of 3 percent on his deposits, calculate the amount in the account upon his retirement.

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

ChapterA: Appendix - Time Value Of Cash Flows: Compound Interest Concepts And Applications

Section: Chapter Questions

Problem 23E

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