I need the answer to 5.12. 5.12 Present value: Tracy Chapman is saving to buy a house in five years. She plans to put 20percent down at that time, and she believes that she will need $35,000 for the down payment. IfTracy can invest in a fund that pays 9.25 percent annual interest, compounded quarterly, howmuch will she have to invest today to have enough money for the down payment?5.13 Present value: You want to buy some bonds that will have a value of $1,000 at the end ofseven years. The bonds pay 4.5 percent interest annually. How much should you pay for themtoday?5 14 Present value: Flizabeth Sweenev wants to aCCumulate $12.000 by the end of 12 vears If

Present value is calculated by discounting the future cash flow. Present value = Future value /…

Answered: 5.12 Present value: Tracy Chapman is…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 3PB: Use the tables in Appendix B to answer the following questions. A. If you would like to accumulate...

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pays 8 percent interest. How much will you have in four years? (See Problem 2.) Calculating Present Values Suppose you have just celebrated your 19th birthday. A rich uncle set up a trust fund for you that will pay you $100,000 when you turn 25. If the relevant discount rate is 11 percent, how much is this fund worth today? (See Problem 3.) 4.2 You'uo h0on offered an investment that will double
13. You have just made your first $4,000 contribution to your retirement account. Assuming you earn an 11 percent rate of return and make no additional contributions, what will your account be worth when you retire in 45 years? What if you wait 10 years before contributing? (Does this suggest an investment strategy?). 14. You are saving up for a down payment on a house. You will deposit $600 a month for the next 24 months in a money market fund. How much will you have for your down payment in 24 months if the fund earns 12% APR compounded monthly?
I need the answer to 5.1.
Use the tables in Appendix B to answer the following questions. A. If you would like to accumulate $2,500 over the next 4 years when the interest rate is 15%, how much do you need to deposit in the account? B. If you place $6,200 in a savings account, how much will you have at the end of 7 years with a 12% interest rate? C. You invest $8,000 per year for 10 years at 12% interest, how much will you have at the end of 10 years? D. You win the lottery and can either receive $750,000 as a lump sum or $50,000 per year for 20 years. Assuming you can earn 8% interest, which do you recommend and why?
Use the tables in Appendix B to answer the following questions. A. If you would like to accumulate $4,200 over the next 6 years when the interest rate is 8%, how much do you need to deposit in the account? B. If you place $8,700 in a savings account, how much will you have at the end of 12 years with an interest rate of 8%? C. You invest $2,000 per year, at the end of the year, for 20 years at 10% interest. How much will you have at the end of 20 years? D. You win the lottery and can either receive $500,000 as a lump sum or $60,000 per year for 20 years. Assuming you can earn 3% interest, which do you recommend and why?
Manshukh
If you were to be promised $10,000 due in one year when interest rates are 5-percent, your investment would be worth…… How much would an investor have to set aside today in order to have $20,000 five years from now if the current rate is 15%? If we deposit $5,000 today in an account paying 10%, how long does it take to grow to $10,000? Bank Beta offers a car loan at 16.25% APR, compounded quarterly. What is the Effective Annual Rate (EAR) on the loan? A savings & loans agency is willing to offer a trader a loan of GH¢1,000 at 3.25% per month for a period of 1 year. What is the EAR
4. Suppose you make an annual contribution of BD100 each year to a college education fund for a niece. She is 4 years old now, and you will start next year and make the last deposit when she is 18. The fund is a money market account earning 6.5%/year. What will it be worth immediately after the last deposit? You may also set up spreadsheet solution
Present value: Tracy Chapman is saving to buy a house in five years. She plans to put 20 percent down at that time, and she believes that she will need $35,000 for the down payment. If Tracy can invest in a fund that pays 9.25 percent annually, how much will she have to invest today? Please use Excel to solve
1. How much would $10,000 due in 100 years be worth today if the discount rate were 9%? 2. You have a chance to buy an annuity that pays $2,000 at the end of each year for 5 years. You could earn 7% on your money in other investments with equal risk. What is the most you should pay for the annuity? 3. You want to buy a condo 5 years from now, and you plan to save $3,000 per year, beginning one year from today. You will deposit the money in an account that pays 8% interest. How much will you have just after you make the 5th deposit, 5 years from now?
You need to have $150,000 in 10 years to buy a house. You already have $70,000. What would be the interest rate you would need?. a. 7.85% b. 7.76% c. 7.92% d. 8.08% e. 8.00%
Aa.37.

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