Question 7 Melina is willing to invest $5000 now and make further monthly investments of $340 for 5 years. If the interest rate is 4.5% per annum compounding monthly, the accumulated amount in the fund before the last deposit of $340 is made to the nearest $ is A $28,758 B $28,748 C $29,088 D $29,090
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- Question 1 You are buying a $300,000 house. You will make the standard 20% down payment, and will finance the rest for 30 years. Your interest rate is 6%. What percentage of your first 10 payments will go just to pay interest on the loan? a) 17% b) 69% c) 83% d) 31% e) 6%FUTURE VALUE OF AN ANNUITY Your client is 40 years old; and she wants to begin saving for retirement, with the first payment to come one year from now. She can save $5,000 per year, and you advise her to invest it in the stock market, which you expect to provide an average retum of 9% in the future. 5-19 a. If she follows your advice, how much money will she have at 65? b. How much will she have at 70? c. She expects to live for 20 years if she retires at 65 and for 15 years if she retires at 70. If her investments continue to eam the same rate, how much will she be able to withdraw at the end of each year after retirement at each retirement age?:you want to go to Europe 4 years from now, and you can save $3300 per year, beginning one year from today. You plan to deposit the funds in a mutual fund that you think will retum 8.5% per year. Under these conditions, how much would you have in your account by the time you are ready for your trip? O a. $12, 344.53. b. $13,799.76 O c. $15, 765.34 O d. $11, 235.11 • e. $14,980.40
- Assume that you can invest to earn a stated annual rate of return of 12 percent, but where interest is compounded semiannually. If you make 20 consecutive semiannual deposits of $500 each, with the first deposit being made today, what will your balance be at the end of Year 20? Group of answer choices $52,821.19 $57,900.83 $58,988.19 $62,527.47 $64,131.507. Calculateannuity cash flows Your goal is to have $10,000 in your bank account by the end of twelve years. If the interest rate remains constant at 9% and you want to make annual identical deposits, what amount will you have to deposit into your account at the end of each year to reach your goal? $496.51 $397.21 $446.86 $595.81 If your deposits were made at the beginning of each year rather than an at the end, what is the amount your deposit would change by if you still wanted to reach your financial goal by the end of twelve years? $34.85 $30.75 $55.35 $41.00Time to accumulate a given sum Personal Finance Problem Manuel Rios wishes to determine how long it will take an initial deposit of $7,000 to double. a. If Manuel earns 8% annual interest on the deposit, how long will it take for him to double his money? b. How long will it take if he earns only 5% annual interest? c. How long will it take if he can earn 10% annual interest? d. Reviewing your findings in parts a, b, and c, indicate what relationship exists between the interest rate and the amount of time it will take Manuel to double his money. a. If Manuel earns 8% annual interest, the amount of time to double his money is years. (Round to two decimal places.) C
- You plan to invest $5,000 into an account. If you would like to have $10,000 in 15 years, what rate of return must you earn? Question 5 options: 6.02% 5.24% 4.73% 7.55% 7.11%5. You take $100 to your local savings bank to invest for five years. You are given the choice of two investments by the banker Notifications Time Left 00:00:28 ? Guide Me 1. You can Invest in a regular savings account that pays you 14.00% interest each year with interest compounded annually. That is each year the interest you can gets deposited in your bank account and earns interest until the end of the five years. it. You can invest in a special account that pays you 20.00% interest each year, the catch is that the interest does not compound, Rattier each year the interest payrrient is put into a special account which collects no further interest and cannot be reinvested anywhere until the end of the five years Which option should you select and why? a, Select Option i: It earns $44.63 more than Optianill b. Both Options earn you the same amount of money so you are indifferent between the two c. Select Option it It earns $7.46 more than Option d. Select Option it It earns $30.00…Assume Sheryl Jenkins wants to accumulate $12,241.30 in two years. She currently has $10,919.00 to invest. What interest rate must she earn on her investment (that is if she deposits $10,919.00 today) to have $12,241.30 exactly two years from today?
- iv Jaimie just graduated and would like to purchase a house in 4 years. If she has $215 automatically invested out of each paycheck at the end of each month for 4 years into an emerging markets value fund paying 11% (compounded monthly), how much of a down payment will she have at the end of 4 years? a. $133,058 b. $12,891 c. $12,600 d. $130,000 e. $12,461Question 2 Suppose that the parents of a young child decide to make semi-annual deposits into a savings account, with the first deposit being made on the child's 5thbirthday and the least deposit being made on the 15th birthday. Then starting on the child's 18th birthday, withdrawals of P 5,000 and an increasing of 10% every semi-annual will be made until his 21stbirthday. If the nominal interest rate is 15% compounded quarterly, what are the semiannual deposits. (Hint: Be careful in counting n-periods) Use the editor to format your answerQuestion Two ii. ii. Ms. Duke is borrowing 12,000 at a compound annual interest rate of 17%. Determine the annual payment to amortize the loan, if she is offered 7 years. At 8% compounded annually, how long will it take 750 to double? A friend plans to buy a big-screen TV/entertainment system and can afford to set aside 1,320 toward the purchase today. If your friend can earn 15%, compounded yearly, how much can your friend spend in four years on the purchase? What would you pay to own a guaranteed income of C1500 per year to be received forever, if interest rates are 14%? At what rate must 500 be compounded annually for it to grow to ¢716.40 in 5 years? Explain the concept of time value of money in line with the financial manager" corporate objective S