Problem 1. Find the maturity value of the followingsimple interest investments.(i) $3125 invested at 2.85% for 7 months.(ii) $12,000 at 5.3% for 11 months.Problem 2. Find the future value of the followinginvestments.(i) $15,000 iinvested at 6% compounded monthly for10 years.(ii) $8500 at 6.9% compounded quarterly for 5 years.Problem 3. Find the effective rate corresponding toeach nomianal rate.(i) 6% compounded quarterly.(ii) 7.25% compounded semiannually.Problem 4. Find the amount needed to be investednow to accumulate the following amount if the moneyis compounded as indicated.(i) $2000 at 7% compounded semiannually for 8 years.(ii) $8800 at 5% compounded quarterly for 5 years.Problem 5. Find the interest rate for each depositand compound amount.$8000 accumulating to $11,672.12 compoundedquarterly for 8 years.(ii) $6725 accumulating to $10,353.47 compoundedmonthly for 7 years.Problem 6. Find the time required for each initialamount to be at least equal to the final amount.$8000 deposited at 3% compounded quarterly toreach at least $23,000.(ii) $4500 deposited at 3.6% compounded monthly toreach at least $11,000.Problem 7.(i) If $1000 are deposited into an account paying3% compounded annually for 5 years, how muchmoney is in the account at the end of the lastdeposit?(ii) If $800 are deposited into an account paying 6.51%compounded semiannually for 12 years, how muchinterest is earned at the end of the last deposit?Problem 8.(i) If $10,000 is needed in 12 years, how much shouldbe deposited at the end of each year into an ac-count paying 5% compounded annually?(ii) If $150,000 is needed in 15 years, how much shouldbe deposited at the end of each month into anaccount paying 6% compounded monthly?Problem 9. You have $8430 in credit card debt. Theinterest rate on the unpaid balance is 27% compoundedmonthly. You decide to pay off the debt in equalmonthly payments at the end of each month.(i) What should the monthly payments be to havethe account paid off at the end of 3 years?(ii) How much interest have you paid?Problem 10. You have $25,000 in an account thatpays 6% interest compounded annually. You want tomake equal annual withdrawals so that the money lasts8 years exactly.(i) Find the amount of each withdrawal.(ii) Find the amount of each withdrawal if the moneymust last 12 years.

Maturity value is the amount that will be received if you invest a sum of money for a certain time…

Answered: Problem 1. Find the maturity value of…

Problem 1. Find the maturity value of the following simple interest investments. (i) $3125 invested at 2.85% for 7 months. (ii) $12,000 at 5.3% for 11 months.

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

100%

Problem 1. Find the maturity value of the following
simple interest investments.
(i) $3125 invested at 2.85% for 7 months.
(ii) $12,000 at 5.3% for 11 months.
Problem 2. Find the future value of the following
investments.
(i) $15,000 iinvested at 6% compounded monthly for
10 years.
(ii) $8500 at 6.9% compounded quarterly for 5 years.
Problem 3. Find the effective rate corresponding to
each nomianal rate.
(i) 6% compounded quarterly.
(ii) 7.25% compounded semiannually.
Problem 4. Find the amount needed to be invested
now to accumulate the following amount if the money
is compounded as indicated.
(i) $2000 at 7% compounded semiannually for 8 years.
(ii) $8800 at 5% compounded quarterly for 5 years.
Problem 5. Find the interest rate for each deposit
and compound amount.
$8000 accumulating to $11,672.12 compounded
quarterly for 8 years.
(ii) $6725 accumulating to $10,353.47 compounded
monthly for 7 years.
Problem 6. Find the time required for each initial
amount to be at least equal to the final amount.
$8000 deposited at 3% compounded quarterly to
reach at least $23,000.
(ii) $4500 deposited at 3.6% compounded monthly to
reach at least $11,000.
Problem 7.
(i) If $1000 are deposited into an account paying
3% compounded annually for 5 years, how much
money is in the account at the end of the last
deposit?
(ii) If $800 are deposited into an account paying 6.51%
compounded semiannually for 12 years, how much
interest is earned at the end of the last deposit?
Problem 8.
(i) If $10,000 is needed in 12 years, how much should
be deposited at the end of each year into an ac-
count paying 5% compounded annually?
(ii) If $150,000 is needed in 15 years, how much should
be deposited at the end of each month into an
account paying 6% compounded monthly?
Problem 9. You have $8430 in credit card debt. The
interest rate on the unpaid balance is 27% compounded
monthly. You decide to pay off the debt in equal
monthly payments at the end of each month.
(i) What should the monthly payments be to have
the account paid off at the end of 3 years?
(ii) How much interest have you paid?
Problem 10. You have $25,000 in an account that
pays 6% interest compounded annually. You want to
make equal annual withdrawals so that the money lasts
8 years exactly.
(i) Find the amount of each withdrawal.
(ii) Find the amount of each withdrawal if the money
must last 12 years.

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