a) You deposit $200 monthly into an annuity with the goal of accumulating $180,000 after 30 years. What annual rate, compounded monthly, is required to ?accomplish this

Q: What is the annual rate of return on a perpetuity that costs $500,000 and pays $2,000 monthly?

A: Following details are given in the question: Cost of perpetuity = $500000 Monthly payment (cashflow)…

Q: Use the formula for the value of an annuity to solve:To save for retirement, you decide to deposit…

A: The future value of the annuity is the total value of all the payments which occurred regularly at a…

Q: At the end of each month for the next ten years you will receive cash flows of $75.  If the…

A: Present value of annuity = 75{1-(1+0.072)^-120}/0.072

Q: Use the ordinary annuity formula to determine the accumulated amount in the annuity.   ​$500…

A: A study that proves that the future worth of the money is lower than its current value due to…

Q: What is the present value of an annuity that pays $58 per year for 13 years and an additional $1,000…

A: We can make use of the financial calculator to obtain the present value, PV. Inputs: I/Y = rate =…

Q: A) Use the appropriate formula to find the value of the annuity. B) Find the interest. Periodic…

A: Part (a)If an annuity A is paid at the end of period over N periods and bears a discount (interest)…

Q: Suppose you invest in an annuity that pays 6% interest, compounded annually. You contribute $4,500…

A: Given information: Annuity payment is $4,500 Interest rate is 6% compounded annually Number of years…

Q: On January 1, 2021, you deposited $6,100 in a savings account. The account will earn 10 percent…

A: Interest received at the end of each year will result in the compounding effect on the deposit at…

Q: After retirement, you expect to live for 25 years. You would like to have a $95,000 income each…

A: Here,

Q: The value of the annuity is ​$______.

A: The worth of today’s dollar at a future date is the future value of the dollar. For example, the…

Q: You invest in an ordinary annuity $3,000 annually at 7% annual interest. What is the future value of…

A: Given:  Amount = 3000 r = 7% n = 5 years

Q: What’s the interest rate of a 5-year, annual $4,800 annuity with present value of $20,000?

A: Given; Present value of annual payments : $20,000 Time period (r): 5 years Annuity: $4,800

Q: Calculate the present value of an annuity with monthly deposits of $2,000 at 5% for 20 years.…

A: Monthly deposits (M) = $2000 Interest rate (r) = 5% per annum = 0.4167% per month n = 20 years = 240…

Q: Which will provide the largest yield on an annuity after 30 years with 6% annual interest,…

A: Given, N = 30 Years r = 6%

Q: What will be the value in your account at the end of Year 30?

A: Future Value of Annuity: It represents the future worth of the annuity payments made for a given…

Q: Find the future value of an annuity of $1300 paid at the end of each year for 15 years, if interest…

A: Annuity is the payment of fixed amount at the end(ordinary) or beginning(due) of a financial period…

Q: What is the present value of a 15 year annuity with the first payment of $65,000 (all payments are…

A: present value of a 15 year annuity with the first payment of $65,000 (all payments are the same…

Q: Calculate the present value AND the future value of an annuity with a monthly cash flow of $100,…

A: A theory that helps to compute the present or future value of the cash flows is term as the TVM…

Q: A perpetuity pays $100 each year, with the first payment scheduled two years from now. Assume that…

A: Amount of $100 will be paid by a perpetuity and that will be started from year 2 (two year from…

Q: On January 1, 2021, you deposited $5,500 in a savings account. The account will earn 10 percent…

A: In many financial computations, such as investment analysis, retirement planning, and assessing the…

Q: Suppose you find an annuity that pays 8% annual interest, compounded annually. If you invest in this…

A: Annuity refers to the amount of installment that is paid regularly in a specific time gap and for a…

Q: Suppose an annuity will pay $14,000 at the beginning of each year for the next 5 years. How much…

A: Annual payment (P) = $14,000 Interest rate (r) = 6.5% Period (n) = 5 Years

Q: Find the present value of an annuity with monthly payments of $8,333.33, at an interest rate of 5.5%…

A: Present value of annuity cash flow = whereA = Periodical cash flow = monthly payment = $8,333.33i =…

Q: a. Calculate the annual cash flows ( annuity payments) from a fixed - payment annuity if the present…

A: Annual cash flows refer to the amount that defines the inflow and outflow of the cash during the…

Q: Assume that today you borrowed $30,000 at 4.25% compounded monthly and will pay off the loan with…

A: The given problem relates to concept of annuity. An annuity is a series of uniform cash flows over a…

Q: Determine the present value of an annuity due of $5,000 per year for 15 years discounted back to the…

A: Using excel PV function

Q: What is the annual rate of return on a perpetuity that costs $500,000 and pays $1,000 monthly?

A: Following details are given in the question: Cost of perpetuity = $500000 Monthly payment (cashflow)…

Q: Find the NPV and PI of an annuity that pays $500 per year for eight years and costs $2,500. Assume a…

A: 1.NPV means Net present value.It is calculated as follows:-NPV = Present value of cash inflows -…

Q: At the end of each month for the next ten years you will receive cash flows of $50.  If the…

A: Annuity refers to the contract between an insurer and the insurance company in which a fixed…

Q: The amount (future value) of an ordinary annuity is given. Find the periodic payment. (Round your…

A: An ordinary annuity is a stream of constant cash flows that occur at the end of every year.

Q: You purchase a $10, 000 annuity with payments at the end of each year for 30 years and an effective…

A: Present value of annuity = $10000 Interest rate (r) = 4% Annuity amount (A) = $500 Additional amount…

Q: Find the future value of an annuity due with an annual payment of $9,000 for two years at 7.5%…

A: future value of annuity due is a series of payments made at the beginning of each period

Q: Suppose that an individual invests $2,500 at the end of each of the next 6 years and earns an…

A: Whenever we are finding present value of a series of fixed payments made in the future, it is called…

Q: d the present value of a 4-year $60 annuity when the stated rate is 6%, compounded monthly. Make…

A: Present value of annuity is equivalent value of today considering the the time and interest of the…

Q: you borrowed $400 from a friend and promised to repay the loan by making three annual payments at…

A: Loan amount is equal to the present value of payment done based on time value of money..

Q: Determine the annual payment required to fund a future annual annuity of $12,000 per year. You will…

A: Present value =cash flow×1-(1+r)-nr r = rate n = number of periods

Q: Find the future value at the end of Year 12 of an annuity that pays $7,500 per year for 12 years…

A: Using excel FV function

Q: You would like to have enough money saved to receive a $90,000 per year perpetuity after retirement.…

A: Given, The cashflows is $90,000 The rate of interest is 8%

Q: search annuities and calculate an annuity that pays you monthly (like a pension) for a 30 year…

A: Annuities are uniform periodic monthly payments that are paid over the period of time based on the…

Q: Find the future value of an annuity due of $1,500 semiannually for six years at 7% annual interest…

A: FV  =  PV * [(1 + i)n - 1] / iFV  =  PV * FVIFA(i,n) where, FV  =  Future Value of AnnuityPV  =…

Q: deposits

A: Introduction: The term annuity refers to series of payments which are made at intervals. Examples of…

Q: If you put up $73,000 today in exchange for an annual 6.75 percent, 18-year annuity, what will the…

A: The annual cash flow can be computed with the help of present value of annuity.

Q: Please assume an annuity due of $100,000 a year for 10 years.  Assuming a discount rate of 6%,…

A: The objective of this question is to calculate the present value of an annuity due. An annuity due…

Effective Interest Rate

The term interest rate can be defined as the amount that is charged by the lender as a percentage on the principal amount. Interest rate which is charged annually is known as annual percentage rate.