9. Which two of the following statements is FALSE (CHOOSE TWO) a. In an ordinary annuity, payments are made at the end of each payment period. b. A mortgage can be considered an annuity. C. Accepting a payment plan for a purchase results in spending the same amount as the original price but spread out over a longer time period. d. Monthly car payments includes interest e. Quarterly payments are made every 4 months. f. The future value of an ordinary simple annuity can be calculated as the sum of a series compound interest calculations

9. Which two of the following statements is FALSE (CHOOSE TWO) a. In an ordinary annuity, payments are made at the end of each payment period. b. A mortgage can be considered an annuity. C. Accepting a payment plan for a purchase results in spending the same amount as the original price but spread out over a longer time period. d. Monthly car payments includes interest e. Quarterly payments are made every 4 months. f. The future value of an ordinary simple annuity can be calculated as the sum of a series compound interest calculations

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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1. Find the amount of an ordinary annuity consisting of 24 monthly payments of $150 that earn interest at 10% per year compounded monthly. Round to the nearest cent. b. Find the present value of an ordinary annuity consisting of 18 monthly payments of $150each and earning interest at 5% per year compounded monthly. Round to the nearest cent. c. True or False: The Annuities we deal with in this section are: Certain, Ordinary, and complex.
Find the following values assuming a regular, or ordinary, annuity: a. The present value of $400 per year for ten years at 10 percent. b. The future value of $400 per year for ten years at 10 percent. c. The present value of $200 per year for five years at 5 percent.d. The future value of $200 per year for five years at 5 percent.Repeat Problem above but assume the annuities are annuities due.(Dollar signs, decimal places, and commas all matter)
"The payments are made monthly and its compounding periods is quarterly." What kind of annuity is this? a. simple annuity b. general annuity
st K (Related to Checkpoint 6.2) (Present value of an ordinary annuity) Nicki Johnson, a sophomore mechanical engineering student, receives a call from an insurance agent who believes that Nicki is an older woman who is ready to retire from teaching. He talks to her about several annuities that she could buy that would guarantee her a fixed annual income. The annuities are as follows: Purchase Price of the Annuity (At t= 0) Amount of Money Received Per Year $6,500 $6,000 $9,000 Annuity A $50,000 B $40,000 C $60,000 (Click on the icon in order to copy its contents into a spreadsheet.) EXZE Duration of the Annuity (Years) 16 12 10 Nicki could earn 8percent on her money by placing it in a savings account. Alternatively, she could place it in any of the above annuities. Which annuities in the table above. if anv. will earn Nicki a higher return than investing in the savings a. If Nicki could earn 8 percent on her money, what is the present value of annuity A with $6,500 payments per year…
Please do not give solution in image format ?
a. Use the appropriate formula to find the value of the annuity. b. Find the interest. Periodic Deposit $2000 at the end of each year Rate 3% compounded annually Click the icon to view some finance formulas. Time 35 years a. The value of the annuity is $ (Do not round until the final answer. Then round to the nearest dollar as needed.) b. The interest is $ (Use the answer from part (a) to find this answer. Round to the nearest dollar as needed.)
1) The amount of down payment one makes on a home directly affects the size of the monthly payments a. True b. False 2) A monthly payment of $ 850 on a 30 year $ 80,000 mortgage results in a total cost of interest of $ 306,000. a. True b. False 3) What are the points on a mortgage?
Ay 2. Find the rate of interest i such that a 20-year annuity with payments at the end of each year has the accumulated value which is exactly three times as much as the accumulated value of a 10-year annuity with payments at the end of each year.
Complete the following for the present value of an ordinary annuity. (Use Table 13.2.) Note: Do not round intermediate calculations. Round your answer to the nearest cent. Amount of annuity expected $ 750 Payment Annually Time 4 years Interest rate 6 % Present value (amount needed now to invest to receive annuity)
Future value of an annuity Using the values below, answer the questions that follow. (Click on the icon here in order to copy the contents of the data table below into a spreadsheet.) Amount of annuity $5,000 Interest rate 6% Deposit period (years) 7 a. Calculate the future value of the annuity, assuming that it is (1) An ordinary annuity. (2) An annuity due. b. Compare your findings in parts a(1) and a(2). All else being identical, which type of annuity-ordinary or annuity due is preferable as an investment? Explain why.
Present value of an ordinary annuity. Fill in the missing present values in the following table for an ordinary annuity:
Appendix D Present value of an annuity of $1, PV PV-A (1+ Percent Period 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 11% 12% 1. 0.990 0.980 0.971 0.962 0.952 0.943 0.935 0.926 0.917 0.909 0.901 0.893 1.970 1.942 1.913 1.886 1.859 1.833 1.808 1.783 1.759 1.736 1.713 1.690 3 2.941 2.884 2.829 2.775 2.723 2.673 2.624 2.577 2.531 2.487 2.444 2.402 4 3.902 3.808 3.717 3.630 3.546 3.465 3.387 3.312 3.240 3.170 3.102 3.037 4.853 4.713 4.580 4.452 4.329 4.212 4.100 3.993 3.890 3.791 3.696 3.605 6. 5.795 5.601 5.417 5.242 5.076 4.917 4.767 4.623 4,486 4.355 4.231 4.111 6.728 6.472 6.230 6.002 5.786 5.582 5.389 5.206 5.033 4.868 4.712 4.564 7.652 7.325 7.020 6.733 6.463 6.210 5.971 5.747 5.535 5.335 5.146 4.968 8.566 8.162 7.786 7.435 7.108 6.802 6.515 6.247 5.995 5.759 5.537 5.328 10 9.471 8.983 8.530 8.111 7.722 7.360 7.024 6.710 6.418 6.145 5.889 5.650 11 10.368 9.787 9.253 8.760 8.306 7.887 7.499 7.139 6.805 6.495 6.207 5.938 ........ 12 11.255 10.575 9.954 9.385 8.863 8.384 7.943 7.536 7.161 6.814 6.492…

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