6) Your daughter is born today, and you want her to be a millionaire by the time she is 35 yearsold. You open an investment account that promises to pay 16% per year. How much moneymust you deposit each year, starting on her 1st birthday and ending on her 35th birthday, soyour daughter will have $1,000,000 by her 35th birthday?NYearI/YCash flow7) The present value of the following cash flow stream is $8,500 discounted at 10 percent annually.What is the value of the missing cash flow?1,000PV1?PMT22,000FV34,0004

To given solution-Explanation:Complete solution.

Answered: 6) Your daughter is born today, and you…

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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man.1 You expect to receive $5,000 at Graduation one year from now. Your plan is to invest this money at 6.5 percent, compounded annually, until you have 50,000. At that time, you plan to travel around the world. How long from now will it be until you can begin your travels?
use excel and explain why
Problem 2. Dean Sundaram is expected to retire in 30 years and he wishes to accumulate $800,000 in his retirement fund by that time (t=30). If the interest rate is 12% per year, how much should Dean Sundaram put into the retirement fund each year (at the end of each year, from t=1 to t=30) in order to achieve this goal?
aa.3 Your daughter is born today and you want her to have $1.5 million dollars by the time she is 35 years old. You open an investment account that promises to pay 8% per year. How much money must you deposit each year, starting on her 1st birthday and ending on her 35th birthday, so your daughter will have $1,500,000 at age 35?
(Future value) Sarah Wiggum would like to make a single lump-sum investment and have $1.7 million at the time of her retirement in 28 years. She has found a mutual fund that expects to earn 77 percent annually. How much must Sarah invest today? If Sarah earned an annual return of 14 percent, how much must she invest today?
You've just invested $770,000 into Far Far Away Investments. This company promises to pay you and later all your future heirs a fixed amount of money once a year forever. The company earns a 5.7% annual return. How much should you expect you and all your future heirs to receive annually?
You invest $4,716.00 at the beginning of every year and your friend invests $4,716.00 at the end of every year. If you both earn an annual rate of return of 8.06%, how much more money will you have after 23.0 years?
your aunt plans to give you the following amounts on cash $1,100 six months from today, $3000 one year from today, $2,300 eighteen months from today, $1,800 twenty four months from today and $1900 thirty months from today. how much money will you have in total after the last cash payment if you invest these cash payments at a rate of 7%
WITH SOLUTION PLS Suppose you make an annual contribution of P8,698 each year to a college fund for a niece. He is 6 years now, and you will start next year and make the last deposit when he is 18. The fund is a money market account earning 5.29% per year. What will it be worth immediately after the last deposit?
Margaret has an investment opportunity where she can receive cashflows as follows 1. $1,000 end of years 1 & 2 2. $1,100 end of years 3 & 4 3. $1,200 end of years 5 to perpetuity 4. $1,400 end of years 8 to perpetuity If you require a return of 8%, how much should you be willing to pay for this investment today? A. $36, 700 B. $59, 750 C. $24, 702 D. $25, 584 E. $27, 353 F. $58, 750
Your friend already has $20,000 in an investment account. In addition to this amount, she is considering investing $5,000 at the end of year 1 with this amount growing at 6% p.a. until the end of year 5. If the interest rate earned by the investment account is expected to be 8% p.a., the total amount she will have accumulated in this account at the end of five years is closest to: Group of answer choices $29,387. $32,776. $62,162. $66,120.
Suppose a husband wants to take his wife on a trip three years from now to Europe to celebrate their 40th anniversary. He has just received a $24,000 inheritance from an uncle and intends to invest it for the trip. The husband estimates the trip will cost $31,000 and he believes he can earn 8% interest, compounded annually, on his investment. Complete the following table to calculate the future value. Will he be able to pay for the trip with the accumulated investment amount? Note: Use tables, Excel, or a financial calculator. Round your final answers to the nearest whole dollar amount. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1)

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