4. David, who plans to go to university in 4 years, estimates that he will need $40000. He isconsidering two investment options:Option A: 5.1% per year, compounded semi-annuallyOption B: 4.9% per year, compounded quarterlya) Determine the present value of each investment.b) Which option should David choose?

Answered: Image /qna-images/answer/65a07cb5-875d-4b9f-8581-52e6530cf25b.jpg

Answered: 4. David, who plans to go to university…

Algebra and Trigonometry (6th Edition)

6th Edition

ISBN:9780134463216

Author:Robert F. Blitzer

Publisher:Robert F. Blitzer

ChapterP: Prerequisites: Fundamental Concepts Of Algebra

Section: Chapter Questions

Problem 1MCCP: In Exercises 1-25, simplify the given expression or perform the indicated operation (and simplify,...

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4)Jonathan invests $8,980 in a bank. The bank pays 5.8% interest compounded quarterly a)How long must he leave the money in the bank for it to double? Round to nearest tenth of a year. Show your work. b)How long will it take to triple? Round to nearest tenth of a year. Show your work. c)If Jonathan is given the choice to invest his money at 5.8% interest compounded quarterly for 5 years or invest his money compounding annually at a rate of 5.85% for 5 years, which option would be best for Jonathan? Explain and show your work.
2. Alanna plans to add an extension on to her home. She applied for a loan of $30 000. Loans are available for five years at 8.9% per year, compounded monthly.
a. Zadia placed $800 in a savings account which pays 6% interest compounded annually. At the end of 5 years she will have in her account. b. The future value interest factor which can be used to compute Zadia's interest is $1040 $1070.40 5.6371 1.338
3 Jeremy has $2300 to invest for 6 years. a) Which is the better investment? Justify your answer. Investment A: Guaranteed Investment Certificate (GIC) that earns 6.8% compounded semi-annually Investment B: bond that earns 6.7% compounded monthly
Bank A advertises a money market account that pays 1.8% compounded quarterly. Bank B advertises a money market account that pays 1.7% compounded daily. a) Determine the annual percentage yield for bank A's money market account. b) Determine the annual percentage yield for bank B's money market account. c) Assuming all other factors are equal, which bank's money market account would be the better investment? a) The annual percentage yield for the bank A money market account is %. (Round to two decimal places as needed.) b) The annual percentage yield for the bank B money market account is %. (Round to two decimal places as needed.) c) Which bank's money market account would be the better investment? Choose the correct answer below. OA. Bank A's money market account is the better investment because the annual percentage yield from bank A is greater than the annual percentage yield from bank B. O B. Bank A's money market account is the better investment because the annual percentage yield…
A couple deposits $20,000 into an account earning 3.5% annual interest for 15 years. Calculate the future value of the investment if the interest is a) Compounded quarterly; Scesos c fers a COICe int mohly ryears You mine ow mochmney b) Compounded weekly; c) Compouded continously.
In 10 years, Cindy wants her investment to reach $40000 for a down payment on a smallhome. She has three investment options:Plan A: 6% annual interest, compounded yearlyPlan B: 5% annual interest, compounded semi-annuallyPlan C: 4.5% annual interest, compounded monthlya)Calculate the present value of each option to determine the amount that Cindy would need to invest today to have her down payment in 10 years.b)Which plan should Cindy choose?
Mr. Bingle who is currently 65 yrs. old and in retirement is looking to invest $400,000 (about 1/3 of his retirement assets), and his local banker is offering the following: 1 year CD at 5.00% 5yr CD at 4.75% 10yr CD at 4.50% 20 yr CD at 4.25% Which option would you recommend and why?
Currently, student loans have a payoff time of 25 years at an interest rate of about 7.5% compounded monthly. Suppose the remaining principal of your student loan is $33,760 and the remaining payoff time is 15 years at the 7.5% rate. You recently inherited $40,000 and can't decide if you should pay off your student loan or invest the money in a high yield savings account. Before moving on... Determine the total amount of the loan you will pay back after the remaining 15 years.

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