Future value. A speculator has purchased land along the southern Oregon coast. He has taken a loan with the end-of-year payments of $7,800 for 10 years. The loan rate is 4%. At the end of 10 years, he believes that he can sell the land for $80,000. If he is correct on the future price, did he make a wise investment? What is the future value of the loan 10 years from now? (Round to the nearest cent.)
Future value. A speculator has purchased land along the southern Oregon coast. He has taken a loan with the end-of-year payments of $7,800 for 10 years. The loan rate is 4%. At the end of 10 years, he believes that he can sell the land for $80,000. If he is correct on the future price, did he make a wise investment? What is the future value of the loan 10 years from now? (Round to the nearest cent.)
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
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Transcribed Image Text:Future value. A speculator has purchased land along the southern Oregon coast. He has taken a loan with the end-of-year payments of $7,800 for 10 years. The
loan rate is 4%. At the end of 10 years, he believes that he can sell the land for $80,000. If he is correct on the future price, did he make a wise investment?
What is the future value of the loan 10 years from now?
(Round to the nearest cent.)
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