Kirk, Klein & Co. requires $108,000 fifteen years from now to retire a debt. A sinking fund (a) What is the size of the monthly payment? (b) What is the balance in the sinking fund after nine years? (c) How much interest will be earned by the fund in the 137th payment interval? (d) By how much will the fund increase during the 138th payment interval? (e) Construct a partial sinking fund schedule showing details of the first three payments, the last three payments, and the totals established into which equal payments are made at the end of every month. Interest is 57% compounded montha

Kirk, Klein & Co. requires $108,000 fifteen years from now to retire a debt. A sinking fund (a) What is the size of the monthly payment? (b) What is the balance in the sinking fund after nine years? (c) How much interest will be earned by the fund in the 137th payment interval? (d) By how much will the fund increase during the 138th payment interval? (e) Construct a partial sinking fund schedule showing details of the first three payments, the last three payments, and the totals established into which equal payments are made at the end of every month. Interest is 57% compounded montha

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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are ? k of &, Deposits of $100 are made at the end of each calendar year from 2014 through 2019 inclusive. The resulting fund is to be used to buy a perpetuity with annual payments following the pattern X, 4X, 7X, 10X,... with the first payment on December 31, 2021. If the anmual effective rate of interest is 5%, find X. A. 0.558 B. 0.567 C. 0.576 D. 0.585 E. 0.594
Deposits of $100 are made at the end of each calendar year from 2014 through 2019 inclusive. The resulting fund is to be used to buy a perpetuity with annual payments following the pattern X, 4X, 7X, 10X,... with the first payment on December 31, 2021. If the anmal effective rate of interest is 5%, find X. A. 0.558 B. 0.567 C. 0.576 D. 0.585 E. 0.594
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 $
A school fund establishes that the following deposits must be made: Year 1, $2,000; Year 2, $2,000 + 500; Year 3, $2,000+ (2)500; ; Year 10, $2,000 (9)500. Beginning in the 11th year, the fund will pay a $X scholarship perpetually. Assuming a 10% interest rate. How big can the scholarship payment be? .
A corporation creates a sinking fund in order to have $500,000 to replace some machinery in 9 years. How much should be placed in this account at the end of each quarter if the annual interest rate is 8.9% compounded quarterly? (Round your answers to the nearest cent.)$ 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 $ How much interest was earned during the third quarter of the 7th year?$
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Using a discount rate of 5.5% compounded annually, a pension fund estimates that the present value of its assets and liabilities are $7 million and $4 million, respectively. The duration of the assets is 11 years and the duration of the liabilities is 27 years. (a) Suppose that the interest rate decreases to 5.45%. Estimate the relative changes in the fund's assets and liabilities. Express yours answers as percentages, to the nearest basis point. Relative Change in Assets % Relative Change in Liabilities % (b) Using your rounded answers from (a), estimate the absolute changes in the fund's assets and liabilities. Express your answers in millions of dollars, to the nearest thousand. Absolute Change in Assets $ million Absolute Change in Liabilities s $ million (c) The fund's net worth is defined as the difference between its assets and liabilities. Using your answers from (b), estimate the relative change in the fund's net worth. Express your answer as a percent, to the nearest basis…
Consider an amount of 25,000 in a fund today. October 25, 2022. DETERMINE ITS value on the specified date given: 1. January 25, 2024 at 3.42% annual effective interest
Contemplating retirement an individual wants to create a fund on an 6% basis allowing $10,000. annual withdraws for 20 years. How much must the balance of the fund equal to allow the $ 10,000. equal annual withdraws beginning one year hence? Following are appropriate factors from tables: Table % / n Present Value of annuity due $1 Present Value of ordinary annuity of $1 Present value of $1 Future Value of ordinary annuity of $1 6%/20 12.15812 11.46992 .31180 36.78559 Required Computation:
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