Jones Assoc. borrowed $40,000. The company plans to set up a sinking fund that will pay back the loan at the end of 8 years. Assuming a rate of 12 percent compounded semiannually, the amount to be paid into the fund each period is: (Use the tables in the textbook.) O a. $17,185.20 O b. $15,580.00 O c. $1,718.52 d. $1,560.00

Jones Assoc. borrowed $40,000. The company plans to set up a sinking fund that will pay back the loan at the end of 8 years. Assuming a rate of 12 percent compounded semiannually, the amount to be paid into the fund each period is: (Use the tables in the textbook.) O a. $17,185.20 O b. $15,580.00 O c. $1,718.52 d. $1,560.00

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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3. Kenchana Sdn. Bhd. needs $2,100,000 in 3 years. Find the required semiannual payment into a sinking fund if funds are invested in an account earning 10% per year compounded semiannually.
A corporation creates a sinking fund in order to have $520,000 to replace some machinery in 11 years. How much should be placed in this account at the end of each quarter if the annual interest rate is 3.8% compounded quarterly? (Round your answers to the nearest cent.) $ How much interest would they earn over the life of the account? $ Determine the value of the fund after 2, 4, and 6 years. 2 years $ 4 years $ 6 years $
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A company plans to make four annual deposits of $4,250 each to a special building fund. The fund's assets will be invested in mortgage instruments expected to pay interest at 12% on the fund's balance. Determine how much will be accumulated in the fund after four years under each of the following situations: 1. The $4250 annual deposit are made at the end of each of the four years and interest is compounded annually. 2. The $4250 annual deposit are made at the beginning of each of the four years and interest is compounded annually. 3. The $4250 annual deposit are made at the beginning of each of the four years and interest is compounded quarterly. 4. The $4250 annual deposit are made at the beginning of each of the four years interest is compounded annually, and interest earned is withdrawn at the end of each year.
A sum of 50,000 deposited in a fund which will earn 12% compound semiannualy for the first 5 years and 8% interest compounded quarterly for the next 7 years. How much will be the amount after 12 years.
Find the interest rate needed for the sinking fund to reach the required amount. Assume that the compounding period is the same as the payment period. $21,563 to be accumulated in 5 years; quarterly payments of $900 The interest rate needed is approximately%. (Type an integer or decimal rounded to two decimal places as needed.)
13. $500 per month is put into a sinking fund. The interest rate for the fund is 8% compounded weekly. a. Determine the balance of the account after 10 years. b. Determine the amount of interest earned throughout these 10 vears.
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A corporation creates a sinking fund in order to have $910,000 to replace some machinery in 9 years. How much should be placed in this account at the end of each month if the annual interest rate is 5.7% compounded monthly? (Round your answers to the nearest cent.) $ How much interest would they earn over the life of the account? $ Determine the value of the fund after 2, 4, and 6 years. 2 years $ 4 years $ 6 years How much interest was earned during the third month of the 4th year? $
Fint the periodic payments PAT necessary to accumulate the given amount in an annity account. (Assume end-of-period deposita and compounding at the same intervals as depovits. Round your answer to the nearest cent.) $65,000 in a fund paying 3% per year, whth quarterty payments for 20 years PHT-1

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