Jane decides to make 5 end-of-year deposits of $10,000 into a fund starting one year from now. 6) She plans to withdraw $5,000 each year for 10 years, starting one year after the last deposit and plans to leave the remaining amount in the fund. What would be balance in the fund 5 years after the last withdrawal? The fund pays 5% per year compounded annually.

Jane decides to make 5 end-of-year deposits of $10,000 into a fund starting one year from now. 6) She plans to withdraw $5,000 each year for 10 years, starting one year after the last deposit and plans to leave the remaining amount in the fund. What would be balance in the fund 5 years after the last withdrawal? The fund pays 5% per year compounded annually.

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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Similar questions

Brenda Young desires to have $20,000 eight years from now for her daughter’s college fund. If she will earn 4 percent (compounded annually) on her money, what amount should she deposit now? Use the present value of a single amount calculation. Use Exhibit 1-C. (Round time value factor to 3 decimal places and final answer to nearest whole number.)
Donna wants to create a scholarship fund by saving for several years before the fund starts making annual scholarship payments forever. She plans to save $222,000.00 per year for 6 years. Her first savings contribution is expected in 1 year. What is the expected amount of the scholarship payment that the fund will make in 7 years if the fund is expected to have a return of 7.86 percent per year, make annual scholarship payments that grow annually by 2.34 percent forever, and make its first scholarship payment in 7 years? O $71,691.25 (plus or minus 10 dollars) $89,580.58 (plus or minus 10 dollars) $96,621.62 (plus or minus 10 dollars) $77,326.18 (plus or minus 10 dollars) Onone of the answers are within 10 dollars of the correct answer 0000
Uma plans on investing $215 monthly into a vehicle that will earn 9.75% for 12 years. At the end of the twelve years, Uma will stop making payments and the fund will move to a more modest 7.17% return vehicle. If Uma is invested for a total of 40 years, what will she have at the end of the 40-year investment? Assume monthly compounding for the entire investment.
Allain Dupre wants to set up a scholarship fund for his school. The annual scholarship payment is to be $3,600 with the first such payment due two years after his deposit into the fund. If the fund pays 4.5%compounded annually , how much must Alain deposit
Janie deposits $10,000 in the bank today. Starting 3 years from now, she makes equal withdrawals of $1,000 for 5 years and then withdraws the remaining amount 10 years from now. How much will she be able to withdraw 10 years from now, assuming the bank pays 6% compounded annually?
Your father has promised to give you Rs 2,00,000 in cash on your 30th birthday, today is your 21st birthday. He wants to know the following things: If he decides to make annual payments into a fund after one year, how much will each have to be if the fund pays 8 %? If he decides to invest a lump sum in the account after one year and let it compound annually, how much will the lump sum be? If he decides to invest a lump sum in the account now and let it compound annually, how much will the lump sum be? Assume 8% rate of interest in each case.
0. Tammy is saving up money for an emergency fund. She hopes to have 4 months' worth of income accumulated, and she takes home $2500 a month. She plans on depositing monthly increments for the next year and a half into a sinking fund which earns 8% Interest, How much should each deposit be?

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