Calculate the present worth for five deposits started by $1000 at year 1 then increased uniformly gradually to reach $1500 at year 5 followed by withdrawals started by $10000 at year 6 then decreased uniformly gradually to reach a constant value of $2000 at year 10,11 and 12, if the interest rate is 15%.

Calculate the present worth for five deposits started by $1000 at year 1 then increased uniformly gradually to reach $1500 at year 5 followed by withdrawals started by $10000 at year 6 then decreased uniformly gradually to reach a constant value of $2000 at year 10,11 and 12, if the interest rate is 15%.

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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Suppose that Php2,000 is deposited at a compound interest rate of 6% annually. Find the total account value after 12 years
I. Suppose that you start a savings account today with $ 265,000.00, from which you will make a single withdrawal for $ 180,000.00 within 15 months. Determine how much money you will have in the account in 3 years if the account pays interest as follows: In the first 6 months at a rate of 5% quarterly compounded continuously; in the next 9 months at an interest rate of 16% per annum compounded quarterly; and in the remaining months at a simple interest rate of 2% effective monthly. Also determine the total interest the account earns during those 2 years. MAKE A CASH FLOW CHART. II.Consider now that the account referred to in Problem I pays effective monthly compound interest at a constant rate from the opening of the account onwards. Then determine the numerical value of the rate that would produce the same effect on the account as that obtained from the way interest is paid in Problem I.
a. What amount could be withdrawn at t=10? b. What uniform annual series deposits (n=10) would result in the same accumulated balance at the end of year 10?
Please answer Five years ago, you entered into a 10-year investment with a simple interest of 4% per annum and a one-time principal P (in pesos) paid at the start of the investment. Today, your bank announced that it will impose a new interest rate of 4.5% compounded quarterly. If three years from now the value of your investment is 150,000 pesos, find an expression for P and use the expression to approximate P.
An investments account offers a 12% annual return. If $35,000 is placed in the account for two years, by how much will the investment grow if interest is compounded (a) annually, (b) semiannually. (c) quarterly, or (d) monthly? Note: Use tables, Excel, or a financial calculator. Round your answers to 2 decimal places. (FV of $1, PV of $1, FVA of $1, and PVA of $1) Initial Investment Annual Rate Interest Compounded Period Invested Future Value a. $ 35,000 12% Annually 2 years ped b. 35,000 12% Semiannually 2 years C. 35,000 12% Quarterly 2 years ook d. 35,000 12% Monthly 2 years nt
A person invests 100,000 TL in bank deposits with an annual nominal interest rate of 10%, convertible to 6 months. After about how many years, this money will be 330.000 TL.
A deposit of $1000 compounds to $2500 in 5 years. The interest on this account compounds quarterly. What is the closest nominal annual rate of return? (a) 2.50% (b) 4.70% (c) 18.75% (d) 20.11%
if an investment pays interest at a rate of 8% compounded semi annually, then an investment of $1000 for 3 years would be found in a table using the future value of 1 table for a. 3 periods at 8% b. 8 periods at 3% c. 12 periods at 2 % d. 6 periods at 4%
Suppose the continuously compounded interest rate this year is 9%, and in subsequent years, itwill be 11%. What is the balance after five years of$6,500 invested today?
Determine the nominal interest rate if an investment of $100 grew to $180 after one year and interest was compounded every 4 months.
A deposit of $19,000 earns a continuous force of interest given by 0.028t for the first 5 years (t is time in years), and a constant force of 0.14 thereafter. What nominal quarterly compounding rate is earned over the first 13 years?
An investment with an initial deposit of $5,210 is growing at an interest rate of 7.55% compounded monthly. Round all answers to two decimal places where necessary. 1. Find the accumulated amount of the investment at the end of 2 years. P/Y = C/Y = PV = $ P/Y = C/Y = PV = $ N = Total Interest = $ PMT= $ 2. At the end of the 2 years, the interest rate changes to 3.69% compounded quarterly. Calculate the accumulated amount in this investment at the end of 6 years from the initial deposit of $5,210. Next Question N = I/Y = PMT= $ FV = $ I/Y = FV = $ % 3. Find the total amount of interest accumulated during the entire 6 years of the investment. (enter a positive value) % 1hr19mins

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