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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Question
Transcribed Image Text:Will be $235,000
have $53,000 to invest. What annual rate of interest must you earn on your
investment to cover the cost of your child's college education?
At 5.3 percent interest, how long does
7. Calculating the Number of Periods
it take to double your money? To quadruple it?
LO 4
8. Calculating Rates of Return
In 2018, one of the first copper pennies struck
LO3
Expert Solution
Step 1
Years = ln(Future value / Present value) / ln(1 + Rate)
Double your money:
Years = ln(2 / $1) / ln 1.053
Years = 9.84 years
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