Salem plans to deposit $2200 every 6 months for 15 years to save for his son's higher education. The rate of return will be 4% compounded semi-annually for the first 5 years and 8% compounded semi-annually for the subsequent 10 years. Calculate the future value of this simple annuity, if he stops payment after 5 years.
Salem plans to deposit $2200 every 6 months for 15 years to save for his son's higher education. The rate of return will be 4% compounded semi-annually for the first 5 years and 8% compounded semi-annually for the subsequent 10 years. Calculate the future value of this simple annuity, if he stops payment after 5 years.
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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![Salem plans to deposit $2200 every 6 months for 15 years to save for his son's
higher education. The rate of return will be 4% compounded semi-annually for the
first 5 years and 8% compounded semi-annually for the subsequent 10 years.
Calculate the future value of this simple annuity, if he stops payment after 5 years.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F56649a0b-cf1e-45fd-839a-be3b71fba865%2F5eea3ed1-d578-419b-9254-6fd8d66b6190%2F1ou09e_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Salem plans to deposit $2200 every 6 months for 15 years to save for his son's
higher education. The rate of return will be 4% compounded semi-annually for the
first 5 years and 8% compounded semi-annually for the subsequent 10 years.
Calculate the future value of this simple annuity, if he stops payment after 5 years.
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