For each of the following situations, Identify (1) the case as either (a) a present or a future value and (b) a single amount or an annulty. (2) the table you would use in your computations (but do not solve the problem), and (3) the Interest rate and time periods you would use. (PV of $1, FV of $1, PVA of $1, and FVA of $1) Note: Use appropriate factor(s) from the tables provided. Round "Table Factors" to 4 decimal places. a. You need to accumulate $10,100 for a trip you wish to take in four years. You are able to earn 10% compounded semiannually on your savings. You plan to make only one deposit and let the money accumulate for four years. How would you determine the amount of the one-time deposit? b. Assume the same facts as in part (a) except that you will make semiannual deposits to your savings account. What is the required amount of each semiannual deposit? 1. You want to retire after working 40 years with savings in excess of $1,020,000. You expect to save $4,080 a year for 40 years and earn an annual rate of Interest of 10%. c-2. Will you be able to retire with more than $1,020,000 in 40 years? d-1. A sweepstakes agency names you a grand prize winner. You can take $229,500 Immediately or elect to receive annual Installments of $30,200 for 20 years. You can earn 12% annually on any Investments you make. d-2. Which prize do you choose to receive? Complete this question by entering your answers in the tabs below. Req A Req B Req C1 Req C2 Req Di Req D2 You need to accumulate $10,100 for a trip you wish to take in four years. You are able to earn 10% compounded semiannually on your savings. You plan to make only one deposit and let the money accumulate for four years. How would you determine the amount of the one-time deposit? Note: Round your answer to 2 decimal places. Future Value Table Values are Based on: Table Factor Present Value Show less A
For each of the following situations, Identify (1) the case as either (a) a present or a future value and (b) a single amount or an annulty. (2) the table you would use in your computations (but do not solve the problem), and (3) the Interest rate and time periods you would use. (PV of $1, FV of $1, PVA of $1, and FVA of $1) Note: Use appropriate factor(s) from the tables provided. Round "Table Factors" to 4 decimal places. a. You need to accumulate $10,100 for a trip you wish to take in four years. You are able to earn 10% compounded semiannually on your savings. You plan to make only one deposit and let the money accumulate for four years. How would you determine the amount of the one-time deposit? b. Assume the same facts as in part (a) except that you will make semiannual deposits to your savings account. What is the required amount of each semiannual deposit? 1. You want to retire after working 40 years with savings in excess of $1,020,000. You expect to save $4,080 a year for 40 years and earn an annual rate of Interest of 10%. c-2. Will you be able to retire with more than $1,020,000 in 40 years? d-1. A sweepstakes agency names you a grand prize winner. You can take $229,500 Immediately or elect to receive annual Installments of $30,200 for 20 years. You can earn 12% annually on any Investments you make. d-2. Which prize do you choose to receive? Complete this question by entering your answers in the tabs below. Req A Req B Req C1 Req C2 Req Di Req D2 You need to accumulate $10,100 for a trip you wish to take in four years. You are able to earn 10% compounded semiannually on your savings. You plan to make only one deposit and let the money accumulate for four years. How would you determine the amount of the one-time deposit? Note: Round your answer to 2 decimal places. Future Value Table Values are Based on: Table Factor Present Value Show less A
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:For each of the following situations, Identify (1) the case as either (a) a present or a future value and (b) a single amount or an annulty.
(2) the table you would use in your computations (but do not solve the problem), and (3) the Interest rate and time periods you would
use. (PV of $1, FV of $1, PVA of $1, and FVA of $1)
Note: Use appropriate factor(s) from the tables provided. Round "Table Factors" to 4 decimal places.
a. You need to accumulate $10,100 for a trip you wish to take in four years. You are able to earn 10% compounded semiannually on
your savings. You plan to make only one deposit and let the money accumulate for four years. How would you determine the amount
of the one-time deposit?
b. Assume the same facts as in part (a) except that you will make semiannual deposits to your savings account. What is the required
amount of each semiannual deposit?
1. You want to retire after working 40 years with savings in excess of $1,020,000. You expect to save $4,080 a year for 40 years and
earn an annual rate of Interest of 10%.
c-2. Will you be able to retire with more than $1,020,000 in 40 years?
d-1. A sweepstakes agency names you a grand prize winner. You can take $229,500 Immediately or elect to receive annual
Installments of $30,200 for 20 years. You can earn 12% annually on any Investments you make.
d-2. Which prize do you choose to receive?
Complete this question by entering your answers in the tabs below.
Req A
Req B
Req C1
Req C2
Req Di
Req D2
You need to accumulate $10,100 for a trip you wish to take in four years. You are able to earn 10% compounded
semiannually on your savings. You plan to make only one deposit and let the money accumulate for four years. How would
you determine the amount of the one-time deposit?
Note: Round your answer to 2 decimal places.
Future Value
Table Values are Based on:
Table Factor
Present Value
Show less A
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Step 1: Define present and future value concepts.
VIEWStep 2: a. Determine the amount to be deposited to make $10,100 in 4 years.
VIEWStep 3: b. Determine the semi-annual deposit to be made to get $10,100 after 4 years.
VIEWStep 4: c. Determine the future annuity of $4080 for 40 years at 10%.
VIEWStep 5: d. Determine the prize to be selected.
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