Leonardo's bank account contains $1,200,000. Leonardo will make equal monthly withdrawals at the end of each month for the next 25 years, at which time the account will have a zero balance. The rate of interest is 4% compounded monthly. What monthly payments will Leonardo receive? O a. $6,334.04 O b. $700,212.63 Oc. $4,000.00 Od. $2,334.04 O e. $227,342,979.57

Leonardo's bank account contains $1,200,000. Leonardo will make equal monthly withdrawals at the end of each month for the next 25 years, at which time the account will have a zero balance. The rate of interest is 4% compounded monthly. What monthly payments will Leonardo receive? O a. $6,334.04 O b. $700,212.63 Oc. $4,000.00 Od. $2,334.04 O e. $227,342,979.57

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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You plan to withdraw the amounts given below over the next five years from a savings account that earns 9% interest compounded annually, how much do you need to deposit now? End of Year 1 $0.00 Year 2 $24,000.00, Year 3 $14,000.00 Year 4 $26,000.00 Year 5 $42,000.00
Lorena's Cart took out a loan from the bank today for $245,800.00. The loan requires Lorena's Cart to make a special payment of $82,400.00 to the bank in 3 years and also make regular, fixed payments of X to the bank each year forever. The interest rate on the loan is 9.60 percent per year and the first regular, fixed annual payment of X will be made to the bank in 1 year. What is X, the amount of the regular, fixed annual payment? O $15,686.40 (plus or minus 3 dollars) O $62,588.64 (plus or minus 3 dollars) O $17,588.29 (plus or minus 3 dollars) O $23,596.80 (plus or minus 3 dollars) O none of the answers are within 3 dollars of the correct answer
You deposit $2,400 each year in an account bearing 4.2% annual interest, with the first deposit made upon opening the account. What will your balance be after 11 total deposits, that is, after 10 years? (Round your answer to the nearest cent; no labels please!) $4
Suppose that you deposit $750 into a bank account today. If the bank pays 8 percent APR per year, compounded quarterly, how much will be in the account at the end of 4 years.A. $812 84B. $750.00C. $1,029.59D. $927.52E. $1.020.37
Suppose Jorge Otero has set up an annuity due with a certain credit union. At the beginning of each month, $130 is electronically debited from his checking account and placed into a savings account earning 6% interest compounded monthly. What is the value (in $) of Jorge's account after 17 months? (Round your answer to the nearest cent.)
Your bank offers to lend you $120, 000 at an 8.25% annual interest rate to start your new business. The terms require you to amortize the loan with 10 equal end-of-year payments. How much interest would you be paying in Year 2? a. $5,904.06. b. $8,487.08 0 c. $6,642.06• d. $7,011.07. e. $9224.68
You have $20,000 that you put on deposit on your 30th birthday at 5% compounded annually. On your 40th birthday, the account begins earning 6%. Then, on your 50th birthday it begins earning 7%. You plan to withdraw equal annual amounts on each of your 61st, 62nd, . . . , 70th birthdays. a. How much will be your annual withdrawal? b. On your way to the bank on your 65th birthday, you decide to withdraw the entire amount remaining. How much do you withdraw?
Suppose Jorge Otero has set up an annuity due with a certain credit union. At the beginning of each month, $140 is electronically debited from his checking account and placed into a savings account earning 6% interest compounded monthly. What is the value (in $) of Jorge's account after 17 months? (Round your answer to the nearest cent.)
Suppose you borrowed $20,000 at a rate of 9.2% and must repay it in 5 equal installments at the end of each of the next 5 years. How much would you still owe at the end of the first year, after you have made the first payment? O a. $16,000.00 O b. $17,106.89 Oc. $14,831.44 O d. $16,671.44 Oe. $15,266.89
Assume you deposit $4,400 at the end of each year into an account paying 10.5 percent interest. a. How much money will you have in the account in 24 years? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. How much will you have if you make deposits for 48 years? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
A.How much money should be deposited each year for14 years if you wish to have $26,800 in the account immediately after making the last deposit? Let i=7% per year. B.How much money should be deposited each year for 14 years if you wish to withdraw $2,940 each year for 6 years, beginning at the end of the 15th year? Let i=7% per year. B. The annual deposit amount should equal $ ( Round to nearest cent )
Pascal has recently opened an RRSP. He plans to deposit $ 733 at the end of every month for 20 years. The account will compound interest semi-annually at the nominal rate of 6.4 %. How much money will Pascal have in his account immediately after his last deposit? a. $ 323528.06 b. $ 365727.37 c. $ 351660.93 d. $ 369243.98 e. $ 379793.81

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