If money earns 3.9% compounded monthly, what two equal payments, one in 1 year and the other in 2 years, would be equivalent to: a. $8,500 today? b. $4,000 due 1 year ago, but not paid, and $6,900 due 3 years ago, but not paid?

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Q: years

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A:

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A: Future value (FV) refers to the value of an investment or an asset at a specified point in the…

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A: The present value of a future amount is calculated using the following formula,

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A: First we need to calculate future value of annuity by using equation below. Where FV= future value…

Q: How long will it take for P 1,000.00 to amount to P 1,346.00 if invested at 6 compounded quarterly?

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A:

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A: Please refer to the image below.

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Q: A payment of $700 is due in 3 years, and $5,000 is due in 5 years. What single payment made today…

A: PV=FV11+rn=$70011+4.54×1004×3+$500011+4.54×1004×5=$612.062293+$3997.59977=$4609.66206=$4609.66

Q: What is the annual rate of return on a perpetuity that costs $500,000 and pays $1,000 monthly?

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A: The time period in months and years is calculated in the next step.

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