open an annuity with $5,200.00 and makes monthly payments of $270.00 paid at the end of each month for 11 years that has an interest rate of 6.9%, compounded monthly. How much is in the account at the end of the 11 years? (Round to 2 decimal places.) How much did Donald deposit? (Round to 2 decimal places.) Donald then decided to withdrawal from the annuity monthly payments for 4 years paid at the end of each month. If he is still getting the same interest rate, what would the monthly payment amount be? The monthly payments are (Round to 2 decimal places.)

open an annuity with $5,200.00 and makes monthly payments of $270.00 paid at the end of each month for 11 years that has an interest rate of 6.9%, compounded monthly. How much is in the account at the end of the 11 years? (Round to 2 decimal places.) How much did Donald deposit? (Round to 2 decimal places.) Donald then decided to withdrawal from the annuity monthly payments for 4 years paid at the end of each month. If he is still getting the same interest rate, what would the monthly payment amount be? The monthly payments are (Round to 2 decimal places.)

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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Peter makes a deposit at the end of every month into a savings account that earns interest at 3.0% compounded semi-annually. He saves for 9 years, and then converts his savings into an annuity that pays him $2,000 at 3.9% compounded monthly at the end of every three months for 18 years. What size of the deposit Peter makes while he is saving?
Freddy agreed to make quarterly payments of $781.25 for 4 years on a loan of $10,000. What simple interest rate is he paying?
Hank made payments of $161 per month at the end of each month for 30 years to purchase a piece of property. He promptly sold it for $136,752. What interest rate, compounded monthly, would he need to earn on an ordinary annuity for a comparable rate of return? (Round to the nearest hundredth as needed.)
Imelda opens a savings account with $12,000, which pays an annual interest rate of 7.8%. If she reinvests the generated interest every month and also deposits $2,300 each month, how much will be in the account after 2 years? The interest is reinvested on the same day as the $2,300 deposit. Otions: 69177.89 71052.15 73548.61 70524.79
Additionally complete the following problems (showing all work): i. Joshua plans to retire in 25 years. He will make 15 years of equal monthly payments into his account. Ten years after his last contribution, he will begin the first of 120 (10 years) of withdrawals of $2900 per month. Assume that the retirement account earns interest of 5.4% compounded monthly for the duration of his contributions, the 10 years in between his contributions and the withdrawals, and the 10 years of withdrawals. How large must Joshua's monthly contributions be in order to accomplish his goal? (The parts below will help you work through this problem.) (a) If Joshua wants to fund 10 years of monthly withdrawals of $2900 at 5.4% interest, compounded monthly, how much needs to be in the account? (b) Use your answer from part (b) as future value to find the present value of a compound interest account for the intervening 10 years. (c) This gives you the amount in the account at the end of the 15 years of…
Minu deposits $950 at the end of each quarter for 6 years in an account that earns 11.8% per year compounded quarterly. At the end of 6 years she has $32 501.04. What would the amount of the annuity be if she doubles the time period to 12 years?
For 12 years, at the beginning of every month, Elsa deposits $200 into a savings account. Once the 12 years is up, she leaves the money in the account for another 8 years. If the account earns interest at a rate of 4.32% compounded quarterly, calculate the accumulated amount in the account at the end of the 20-year period.
Shelly deposits the $2000 she got as a birthday gift from her grandmother into an account earning 3.6% interest compounded monthly. She decides to also deposit $200 at the end of each month into the same account. How much will be in the account in 10 years?
Mr. Peabody drove to his bank and deposited $500 at the end of every three months for 15.6 years. What is the accumulated value of Mr. Peabody's annuity at 4.95% compounded semi-annually?
Rosa has a annuity worth $20, 000 to help pay for expenses while they are in a year-long (12-month) masters program. The annuity earns 5.4 % compounded monthly. Using the present value annuity formula, they find the will receive $1708 monthly during this time, sent to them at the start of the month. Fill in the table to track how much money remains in the annuity after each month. Round answers to 2 decimal places and use rounded answers in subsequent calculations. Time (Months) 0 2 3 Balance at start of month (after payment) $ $ $ Interest Earned during Time Period $ s $ Balance at end of month $ 20,000 $ $ $
Franklin owes the following amounts to the same person: $16,000 due today, $11,500 due in 1¼ years, $17,000 due in 2¾ years, and $15,000 due in 4¼ years. He wants to make a single payment of $56,500 instead. Using an interest rate of 8% compounded quarterly, when should this payment be made?
Asa has invested money from the settlement of an insurance claim. She plans to withdraw $ 2,560 from her savings account at the end of each quarter for five years. If the payments are deferred for five years and interest is 8% compounded semi-annually, what was the amount of the insurance settlement?

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