On August 1, Rachael Westlake joined a Christmas Club. Her bank will automatically deduct $120 from her checking account at the end of each month and deposit it into her Christmas Club account, where it will earn 67% interest. The account comes to term on December 1. (Round your answers to the nearest cent.) (a) Find the present value of the given annuity. $ X (b) Interpret the present value of the given annuity. You would have to invest a lump sum of $ X now instead of $120 per month.

On August 1, Rachael Westlake joined a Christmas Club. Her bank will automatically deduct $120 from her checking account at the end of each month and deposit it into her Christmas Club account, where it will earn 67% interest. The account comes to term on December 1. (Round your answers to the nearest cent.) (a) Find the present value of the given annuity. $ X (b) Interpret the present value of the given annuity. You would have to invest a lump sum of $ X now instead of $120 per month.

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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A personal account earmarked as a retirement supplement contains $292,100. Suppose $250,000 is used to establish an annuity that earns 4%, compounded quarterly, and pays $6500 at the end of each quarter. How long will it be until the account balance is $0? (Round your answer UP to the nearest quarter.)
Sandy just received her annual bank statement. Exactly one year ago, she deposited $10,000 in a savings account. Today, her balance is $10,509.45. Sandy's savings account interest is compounded quarterly. Using simple interest as a guideline, Sandy received an annualized interest rate of_percent. a. 5, b. 5.5, c. 6, d. 6.5
Jasmine is making quarterly contributions of of $440 to her savings account which pays interest at the APR of 6.6%, compounded quarterly. Right after Jasmine makes her 38th contribution, the bank changes the APR to 4.4% and Jasmine makes 43 more $440 contributions. What is Jasmine's balance right after her last contribution?$
Using a scientific calculator Mr and Mrs Gonzales set up a TDA to save for their retirement. They are having $100 deducted from Mrs. Gonzales's biweekly checks which will earn 8 1/8% interest. Find the future value of their ordinary annuity if it comes to term after they retire in 35.5 years.
Noah has $4686 in his savings account today. The interest rate is 8,3% p.a. compounded monthly. Noah can make 45 equal monthly deposit of $468 starting in one month. Calculate the balance of Noah's savings account 8 months after he makes the last deposit. ( answer using excel )
Since the birth of her daughter, 20 years ago, William has deposited $50 at the beginning of every month into a Registered Education Savings Plan (RESP). The interest rate on the plan was 5.10% compounded monthly for the first 8 years and 4.00% compounded monthly for the next 12 years. a. What would be the accumulated value of the RESP at the end of 8 years? Round to the nearest cent b. What would be the accumulated value of the RESP at the end of 20 years? Round to the nearest cent c. What is the amount of interest earned during the 20 year period? Round to the nearest cent
please help answer
The terms of a single parent's will indicate that a child will receive an ordinary annuity of $12,000 per year from age 18 to age 24 (so that the child can attend college) and that the balance of the estate goes to a niece. If the parent dies on the child's 12th birthday, how much money must be removed from the estate to purchase the annuity? (Assume an interest rate of 7%, compounded annually. Round your answer to the nearest cent.)
Yolanda deposited $1,800 at the end of each six months for 2 years in a savings account. If the account paid 4% interest, compounded semiannually, use Table 12-1 to find the future value of her account. (Round your answer to the nearest cent.)
Yolanda deposited $1,800 at the end of each six months for 2 years in a savings account. If the account paid 4% interest, compounded semiannually, use Table 12-1 to find the future value of her account. (Round your answer to the nearest cent.) $
Kia deposited $1,300, at the BEGINNING of each year for 26 years in a credit union account. If the account paid 8% interest, compounded annually, use the appropriate formula to find the future value of her account. $95,037.72$103,940.74 $112,256.00$113,556.00
On September 8, Bert Sarkis joined a Christmas club. His bank will automatically deduct $100 from his checking account at the end of each month and deposit it into his Christmas club account, where it will earn 7% interest. The account comes to term on December 1.(a) Find the future value of the account, using an annuity formula. (Round your answer to the nearest cent.)$ (b) Find the future value of the account, using the compound interest formula. (Round your answer to the nearest cent.)$ (c) Find Bert's total contribution to the account.$ (d) Find the total interest. (Round your answer to the nearest cent.)$

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