Suppose Christian stops for coffee a given number of times a week. Use the information in the following table to calculate how much Christian would save if he deposited the amount he would spend on coffee into an ordinary annuity instead. Assume there are four weeks in a month. Number of Coffees Price of Interest Rate Number of Per Week One Cup $4.00 for Annuity Years 6. 4.1% 14 Christian would have $ in the annuity. (Round to the nearest cent as needed.)

Suppose Christian stops for coffee a given number of times a week. Use the information in the following table to calculate how much Christian would save if he deposited the amount he would spend on coffee into an ordinary annuity instead. Assume there are four weeks in a month. Number of Coffees Price of Interest Rate Number of Per Week One Cup $4.00 for Annuity Years 6. 4.1% 14 Christian would have $ in the annuity. (Round to the nearest cent as needed.)

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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Similar questions

Determine the kind of annuity used in the following situations. Then, solve the problem. Show your neat and complete solution. 1. Your dad deposits P 10,000 every 3 months for 7 years in an account paying 4% compounded quarterly.How much will she have in his account at the end of 7 years assuming no withdrawals were made?
Sam invests $100 each month into his retirement account. He wants to determine how much will accumulate in his retirement account if he invests for the next 10 years if he can get a 6% return. How would he do this? Group of answer choices This is a future value of an annuity with a .5% interest rate and 120 payments This is a future value of $1 with an interest rate of 6% and 10 time periods. This is a future value of $1 with an interest rate of .5% and 120 time periods. This is a future value of an annuity with a 6% interest rate and 10 payments
the wood family wants to save money to travel the world. they plan to invest in an ordinary annuity that ears 7.8% interest, compounded monthly. payments will be made at the end of each month.How much money do they need to pay into the annuity each month for the annuity to have a total value of $12,009 after 10 years?
Mick Mitchell wishes to have $120,000 in seven years. If he can earn annual interest of 12%, how much must he invest today? Click the icon to view Present Value of Ordinary Annuity of $1 table.) (Click the icon to view Future Value of Ordinary Annuity of S1 table.) (Click the icon to view Present Value of S1 table.) (Click the icon to view Future Value of S1 table.) OA. $265,320 В. $1,210 OC $54,240 OD. S111,960
B7
2. Your aunt invested in a variable insurance product of universal bank. If her annual premium is P40 000 for 10 years, what single amount should your aunt invest today instead of an annuity? How much will be paid out to your aunt after 10 years? Assume that the interest rate is 4% compounded monthly.
Calculate (rounded to the nearest cent) the value c tieth birthday. Money in the savings account will earn interest at a rate of 9% pa The retirement annuity will earn interest at a rate of 12% pa compounded monthly. all the money in his savings account at that time to purchase a retirement annuity. Immediately after making his last deposit on his fiftieth birthday, the man will use consecutive equal monthly deposits P into a savings account starting on his thir- To be able to retire on his fiftieth birthday, a twenty-nine year old man will make 6.5.1 Example compounded monthly. the man's monthly deposits for each of the following retirement plans. A The retirement annuity will pay the man R1 000 every month for fifteen years.
Hank made payments of $106 per month at the end of each month for 30 years to purchase a piece of property. He promptly sold it for $99,810. What annual interest rate would he need to earn on an ordinary annuity for a comparable rate of return? ◻️٪؜ (Round to the nearest hundredth as needed.)
Lola Fritola is planning for her retirement by making quarterly payments to an annuity with each payment increasing by 0.4% every quarter. Her first payment is $5,100 and she plans to contribute for the next 10 years. How much will she have in her retirement savings if the money is invested to earn 4.2% compounded quarterly? (Round your final answer to 2 decimal places.) Retirement savings
Tom wants to put aside $120 at the end of each month into an account earning 6% compounded monthly, and have 30,000 at the end of ten years. How much would tom’s initial balance have to be? Savings lans are one of the common types of annuities. As stated earlier, an annuity is a series of equal payments amde at regular intervals. We will look at ordinary annuities in which payments are made at the end of each period. The futrue value of an ordianry annuity formula is A is the future value r is the annual interest rate n is the number of interest periods per year t is the number of years m is the regular payment
If you took a home mortgage loan of $200.000 for 30 years at 9.2%. compounded monthly. Suppose after 5 years you had an additional $10.000. Would you save more over the life of the loan by paying an extra $10,000 (one-time) with your 60th payment or by paying $2,000 per month beginning with the 61st payment? To help you answer this question, complete the following. (a) Find monthly payments and find the unpaid balance after 60th payments with and without extra payment. (b) Determine how long it takes to pay off the loan with the regular payments you calculated in (a) and the additional $10.000 payment. Then find the total interest paid. (c) Determine how long it takes to pay off the loan without the additional $10,000 payment, but with monthly payments of $2.000 from the 61st payment Then find the total interest paid. (d) Which payment method costs less?
Suppose Chris plans to make a $644 savings payment at the beginning of each month for 22 years with his first payment 10 years from today. Use this information and assume an interest rate of 5.91% per year to find the future value of his savings payments.

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