Question 1. If you want to have $60,000 in 8 years, how much do you need to deposit in the bank today if the account pays an interest rate of 9%? 2. What will $110,000 grow to be in 9 years if it is invested today at 11%? 3. You would like to have $200,000 in a college fund in 15 years. How much do you need today if you expect to earn 12% while you are investing to pay for your child's college? Answer Insert your answer. Insert your answer. Insert your answer.
Question 1. If you want to have $60,000 in 8 years, how much do you need to deposit in the bank today if the account pays an interest rate of 9%? 2. What will $110,000 grow to be in 9 years if it is invested today at 11%? 3. You would like to have $200,000 in a college fund in 15 years. How much do you need today if you expect to earn 12% while you are investing to pay for your child's college? Answer Insert your answer. Insert your answer. Insert your answer.
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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Formulas
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Here are some formulas that you can refer to for Set 1 Parts 1 and 2
#1 Use the PV Formula
PV = 60,000*1/(1+0.09)^8
#2 Use the FV Formula
FV = 110,000*(1+0.11)^9
#3 Use the PV Formula
PV = 200,000*1/(1+.12)^15
Example Part 2
#1 = NPV(Discount Rate, range of values)+initial investment.
#2 = NPV(Discount Rate, range of values)+initial investment.
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In addition to your text, you can also visit Investopedia.com. There you should be able the
Respectfully,
Dr. McLetchie
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Transcribed Image Text:3 Future value formula:
4
Question
1. If you want to have $60,000 in 8 years, how
much do you need to deposit in the bank today if
the account pays an interest rate of 9%?
5
2. What will $110,000 grow to be in 9 years if it
6 is invested today at 11%?
3. You would like to have $200,000 in a college
fund in 15 years. How much do you need today
if you expect to earn 12% while you are
7 investing to pay for your child's college?
Answer
+
Insert your answer.
Insert your answer.
Insert your answer.
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