Engr. Chloe deposits P10,000 in a savings account on the day her child is born. She deposits an additional $1000 on every birthday after that. The account has a 5% nominal interest rate, compounded continuously. How much money will be in the account the day after the child's 21st birthday?

Engr. Chloe deposits P10,000 in a savings account on the day her child is born. She deposits an additional $1000 on every birthday after that. The account has a 5% nominal interest rate, compounded continuously. How much money will be in the account the day after the child's 21st birthday?

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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When you were born, your dear old Aunt Minnie promised to deposit $1,000 into a savings account bearing a 5% compounded annual rate on each birthday, beginning with your first. You have just turned 22 and want the dough. However, it turns out that dear old (forgetful) aunt Minnie made no deposits on your third, fifth, and eleventh birthdays. How much is in the account right now?
The parents of a newborn decide to make deposits into an educational savingsaccount on each of their daughter's birthdays, starting with her first birthday.Assume that the educational savings account will return a constant 5.5% per year.The parents plan to deposit $2 200 on every of their daughter's future birthdays.How much money could they alternatively deposit on their daughter's birth date(today) to have the same amount available on her 18th birthday?
Suppose that the parents of a young child decide to make annual deposits into a saving account, with the first deposit being made on the child's fifth birthday and the last deposit being made on the 15th birthday. Then, starting on the child's 18th birthday (EOY), four withdrawals will be made. The sequence of the amounts of withdrawals is $2000, $2400, $2800, and $3200. If the effective annual interest rate is 8% during this period, what are the annual deposits in years 5 through 15? Use a uniform gradient amount in your solution and support your work by drawing the cash flow diagram. Draw the cash flow diagram and solve the problem. Upload your answer in the moodle. Answer: D Fir
Gilberto opened a savings account for his daughter and deposited $1000 on the day she was born. Each year on her birthday, he deposited another $1000. If the account pays 11% interest, compounded annually, how much is in the account at the end of the day on her 12th birthday? At the end of the day on her 12th birthday, the amount in the account is $ (Simplify your answer. Type an integer or a decimal. Round to the nearest cent if needed.)
April has $500 in the bank. The account will earn 4% in simple interest for the next 3 years. How much interest will April earn? Show your work.
A woman deposits $260 of her quarterly check into an annuity for the education of her child. She does this at the end of each quarter for 4 years into an account paying 6% per year, compounded quarterly. Find the amount of the annuity and the interest earned.
how much interest will ali earn in the 9th year if she deposits $12,500 today in ONE BANK's savings account that earns 4.75% interest compounded annually?
Your grandfather put some money in an account for you on the day you were born. You are now 16 years old and are allowed to withdraw the money for the first time. The account currently has $5,311 in it and pays an 11% interest rate. a. How much money would be in the account if you left the money there until your 25th birthday? b. What if you left the money until your 65th birthday? c. How much money did your grandfather originally put in the account? a. How much money would be in the account if you left the money there until your 25th birthday? If you left the money there until your 25th birthday, the amount in the account would be $ nearest cent.) (Round to the
What payment every year should Carie deposit to her savings account in order to save $37,100 in 11.5 years if money can earn 3.19% compounded annually?
Peter makes a deposit at the end of every three months into a savings account that earns interest at 5.8% compounded semi-annually. He saves for 7 years, and then converts his savings into an annuity that pays him $400 at the beginning of each month for 7.5 years at the same interest rate. What size of the deposit Peter makes while he is saving?

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