calculate how much you would have in a savings account 5 $1,000 today, given that the interest paid is 8% compounded: a. Annually b. Semiannually c. Quarterly d. Continuously om now if you 3. What is the present value of a perpetuity of $80 per year if the discount rate is 11% I 4. If you need $6,000 5 years from now, how much of a deposit must you make in your savin account each year, assuming an 8% annual interest rate?
calculate how much you would have in a savings account 5 $1,000 today, given that the interest paid is 8% compounded: a. Annually b. Semiannually c. Quarterly d. Continuously om now if you 3. What is the present value of a perpetuity of $80 per year if the discount rate is 11% I 4. If you need $6,000 5 years from now, how much of a deposit must you make in your savin account each year, assuming an 8% annual interest rate?
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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Transcribed Image Text:2. Calculate how much you would have in a savings account 5 years from now if you invest
$1,000 today, given that the interest paid is 8% compounded:
a. Annually
b. Semiannually
c. Quarterly
d. Continuously
3. What is the present value of a perpetuity of $80 per year if the discount rate is 11%
I
4. If you need $6,000 5 years from now, how much of a deposit must you make in your savings
account each year, assuming an 8% annual interest rate?
5. You have applied for a home mortgage of $75,000 to finance the purchase of a new home
for 30 years. The bank requires a 14% interest rate. What will be the annual payment?
6. Set up an amortization schedule for a $5,000 loan to be repaid in equal installments at the
end of each of the next 3 years. The interest rate is 15%
7. Suppose that a company borrows $20,000 for 1 year at a stated rate of interest of 9%. What
is the annual percentage rate (APR) if interest is paid to the lender
a. Annually
b. Semiannually
c. Quarterly
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