Equal deposits are made into a sinking fund at the end of each year for seven years. Interest is 11.71% compounded annually, and the maturity value of the fund is $23,000. a.) Calculate the size of the annual deposits. b.) Calculate the increase in the fund for the fourth year.

Equal deposits are made into a sinking fund at the end of each year for seven years. Interest is 11.71% compounded annually, and the maturity value of the fund is $23,000. a.) Calculate the size of the annual deposits. b.) Calculate the increase in the fund for the fourth year.

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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Vv john made a deposit of 1000 into a fund at the beginning of each year for 20 years. at the end of year 20 years, he began making semiannual withdrawls of 3000 at the beginning of each 6 months, with a smaller final withdrawl to exhaust the fund. the fund earned an annual effective rate of 8.16%. calculate the amound of the final withdrawl
13. A sinking fund of $60,000 is to be established with equal payments at the end of each 3-month period for 10 years. Find the amount of each payment if money is invested 12%, compounded quarterly.
$2,950 was deposited at the end of every six months for 8 years into a fund earning 4.5% compounded semi-annually. After this period, the accumulated money was left in the account for another 7 years at the same interest rate. a) Calculate the accumulated amount at the end of the 15-year term. $ b) Calculate the total amount of interest earned during the 15-year period.
At the beginning of the year, an investment fund was established with an initial deposit of 500 . A deposit 1000 is made at the end of each month for the first six months. Starting from theend of month 7, a withdrawal of 300 is made at the end of each month for 5 months for a total of 5 withdrawals. The amount in the fund at the end of the year is 12,500. Calculate the dollar-weighted(money-weighted) yield rate earned by the fund during the year.
For the sinking fund, use Table 12-1 to calculate the amount (in $) of the periodic payments needed to amount to the financial objective (future value of the annuity). (Round your answer to the nearest cent.) Sinking Fund Payment $ 27658 x Payment Frequency every year Time Period (years) 14 Interest Nominal Rate (%) Compounded annually 8 Future Value (Objective) $750,000
Bright Inc. will be receiving $5,500 at the end of every month for the next 2 years. If these payments were directly invested into a fund earning 6.00% compounded semi-annually, what would be the future value of the fund at the end of 2 years? Round to the nearest cent
2. Northern Flying Science is preparing to buy an aircraft estimated to cost $600,000 by making equal payments at the end of every three months into a sinking fund for five years. Interest earned by the fund is 8% compounded quarterly. a. What is the size of the quarterly payment made to the sinking fund? b. How much of the maturity value of the fund will be interest? c. What is the accumulated value of the fund after two years? d. How much interest will the fund earn in the 15th payment interval? Using BA II Plus Calculator
Jeff deposits 10 into a fund today and 20 fifteen years later. Interest for the firstten years is credited at a nominal discount rate of d compounded quarterly, and thereafterat a nominal interest rate of 6% compounded semiannually. The accumulated balance in thefund at the end of 30 years is 100. Calculate d.
$4,250 was deposited at the end of every six months for 5 years into a fund earning 2.2% compounded semi-annually. After this period, the accumulated money was left in the account for another 4 years at the same interest rate. a) Calculate the accumulated amount at the end of the 9-year term. $ b) Calculate the total amount of interest earned during the 9-year period.
Bright Inc. will be receiving $5,500 at the end of every month for the next 3 years. If these payments were directly invested into a fund earning 6.00% compounded semi- annually, what would be the future value of the fund at the end of 3 years? $0.00 Round to the nearest cent
2,500 is deposited into Fund X, which earns an annual effective rate of zero. At the end of each year, 10% of the balance is withdrawn from the fund. The annual withdrawals are deposited into Fund Y, which earns an annual effective rate of 10%. Determine the accumulated value of Fund Y at the end of year 10. a) 2,806 b) 2,252
Use the sinking fund formula shown to the right to determine the semiannual payments with 8% interest are compounded semiannually for 4 years to accumulate $24,000.

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