A perpetuity is to pay $21,000 at the end of every six months. How much less money is required to fund the perpetuity if the moneycan be invested to earn 4% compounded semiannually instead of 3% compounded semiannually? (Do not round Itermedlatecalculations.)%24less money is required

Solution:- Perpetuity means the payment made forever. Value of perpetuity = Periodic Payments /…

A perpetuity is to pay $21,000 at the end of every six months. How much less money is required to fund the perpetuity if the money can be invested to earn 49% compounded semiannually instead of 3% compounded semiannually? (Do not round Intermedlate calculations.) $4 less money is required

A perpetuity is to pay $21,000 at the end of every six months. How much less money is required to fund the perpetuity if the money can be invested to earn 49% compounded semiannually instead of 3% compounded semiannually? (Do not round Intermedlate calculations.) $4 less money is required

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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A perpetuity is to pay $21,000 at the end of every six months. How much less money is required to fund the perpetuity if the money
can be invested to earn 4% compounded semiannually instead of 3% compounded semiannually? (Do not round Itermedlate
calculations.)
%24
less money is required

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Do not provide solution in imge format. and also do not provide plagarised content otherwise i dislike. Monthly payments of $150 are paid into an annuity beginning on January 31, with a yearly interest rate of 12%, compounded monthly. Add the future values of each payment to calculate the total value of the annuity on September 1.On September 1, the value of the annuity will be $ (Round to the nearest cent.)
Two annuities are available for purchase that your client has identified. The first annuity pays $7,000 each six-month period over a 5-years period, at a nominal rate of 9% p.a. The annuity has an annual fee of $300, paid at the beginning of each year. The second annuity pays $1,000 each month, again over 5 years at a nominal rate of 10% p.a. and does not have an annual fee. If each of the annuities cost $50,000, identify which of the annuities you would recommend to your client.
A sum of $ 10, 000 is used to buy a deferred perpetuity-due paying $671.69 every six months forever. Find the deferred period in years if the annual effective rate of discount is d = 0.09. ANSWER = years.
A 15-year annuity pays $1,750 per month, and payments are made at the end of each month. If the APR is 9 percent compounded monthly for the first seven years, and APR of 6 percent compounded monthly thereafter, what is the value of the annuity today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Present value
To save for graduate school, a student invests $1470 semiannually in an ordinary annuity with 3% interest compounded semiannually. Determine the accumulated amount in the student's annuity after 15 years.
How much can be paid in scholarship at the beginning of each month if $231,500 is deposited in a trust fund if interest is 5.6% compounded monthly?
What amount should be deposited at 6% in order to draw out 20000 at the end of each year for seven years, and leave nothing in the fund at the end?
If money can earn 5.1% compounded monthly, how much more money is required to fund an ordinary annuity paying $250 per month for 30 years than to fund the same monthly payment for 20 years? (Do not round intermediate calculations and round your final answer to 2 decimal places.) $ more is required
a personal account earmarked as a retirement supplement contains 242,400. suppose 200,000 is used to establish an annuity that earns 6% compounded quarterly and pays 4,500 at the end of each quarter. How long until the account balance is zero?
Yarianny wants to withdraw $25199 annually starting today for the next 20 years and will increase the withdrawals by 3.5% each year. If the annuity can earn 6% compounded semi-annually, how much money needs to be invested in the fund today? Select the closest answer choice. Select one: Oa. $402571.57 Ob. $427770.57 O c. $478168.57 d. $452969.57 Check
10) Vanessa wants to withdraw $8,000 each year from July 1, 2025 through July 1, 2029. The investment fund earns interest at a rate of 5%. In order to make these withdrawals, Vanessa will invest an annuity on July 1, 2021 through July 1, 2024. Calculate the annuity Vanessa needs to invest each year. Yellow Company purchases a truck on January 1, 2021. According to the contract Yellow will not make any payments in 2021, 2022 and 2023. Yellow is to make an annuity payment of $5,000 starting December 31, 2024 through December 31, 2028. Calculate the cost of the truck. 11) Stella has $3,000,000 in her investment fund. She wishes to withdraw $338,868 12) at the end of each of the next 13 years. What interest rate must she earn in order to accomplish her goal. A note receivable that is due in 15 months from now is always classified as a 13) long-term asset. (True/False) 14) A long-term note receivable should be disclosed in Other Assets in a classified balance sheet. (True/False)
You deposit $9500 per quartely for 1 years at i, = 8.31 %. This fund then provides for a perpetuity of $6100 per year, with the first payment made n month after the final deposit. At the time of the first perpetuity payment, interest rates fall to i, = 2.37 %. Find n. %3D Answer: 30.36

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