A part) Your relative has promised to remember you in her will. You will receive $1,000,000 thirty-nine years from today. If the annual interest rate is 11 percent, what is the promised inheritance worth today? B part) Twenty years ago, your grandmother opened a bank account in your name. She deposited $1,000 and has let all of the interest accumulate. You plan to retire thirty years from today. If the annual interest rate is (was) 9 percent throughout, how much money will be in the account when you retire?
A part) Your relative has promised to remember you in her will. You will receive $1,000,000 thirty-nine years from today. If the annual interest rate is 11 percent, what is the promised inheritance worth today? B part) Twenty years ago, your grandmother opened a bank account in your name. She deposited $1,000 and has let all of the interest accumulate. You plan to retire thirty years from today. If the annual interest rate is (was) 9 percent throughout, how much money will be in the account when you retire?
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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Time value of money:-
A part) Your relative has promised to remember you in her will. You will receive $1,000,000 thirty-nine years from today. If the annual interest rate is 11 percent, what is the promised inheritance worth today?
B part) Twenty years ago, your grandmother opened a bank account in your name. She deposited $1,000 and has let all of the interest accumulate. You plan to retire thirty years from today. If the annual interest rate is (was) 9 percent throughout, how much money will be in the account when you retire?
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