Ten years ago, Hailey invested $1,100 andlocked in a 8 percent annual interest ratefor 30 years (end 20 years from now).Aidan can make a 20-year investmenttoday and lock in a 9 percent interest rate.How much money should he invest now inorder to have the same amount of moneyin 20 years as Hailey? (Do not roundintermediate calculations and round yourfinal answer to 2 decimal places.) Presentvalue $

First we need to use future value formula to calculate value after 30 yearsFVn = PV*(1 + r)n FVn =…

Answered: Ten years ago, Hailey invested $1,100…

Ten years ago, Hailey invested $1,100 and locked in a 8 percent annual interest rate for 30 years (end 20 years from now). Aidan can make a 20-year investment

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

Ten years ago, Hailey invested $2,000 and locked in a 9 percent annual interest rate for 30 years (ending 20 years from now). Aidan can make a 20-year investment today and lock in a 10 percent interest rate.How much money should he invest now in order to have the same amount of money in 20 years as Hailey?
Vijay
Pueblo starts his account with the amount of $8,000. he add $100 each month. the account earns 7.1% interest, compounded monthly. The investment will last him for about 41 years. Pubelo thinks that beyond the $100 that he add each month, how much additional monthly payment will he need to add in order for the account to end with $770,000 after 41 years.
kyle has a $15,000 in college debt when he graduates. he will pay it back with regular monthly payments $283.07 for the next 5 years. his loan is charging 5% interest per year compounded monthly. at the end of the 5 years how much total interest will kyle have paid.
Darwin has a capital of $ 7100 which he invests for 3 years at 7.6 % p. a. a)How much will he receive come maturity time if the interest is compounded annually? Round to the nearest 100th. b)How much will he received come maturity time if the interest is compounded semi-annually? Round to the nearest 100th . c)How much will he receive come maturity time if the interest is compounded quarterly? Round to the nearest 100th . Then, George Green wishes to invest $ 8000 that he saved from his summer job. His bank offers 3.75 % for a one-year term investment or 3.5 % for a six-months term. a)How much will George receive (capital plus interest) after one year if he invests at the one-year rate? Round to the nearest one. b)How much will he receive (capital plus interest) after one-year if he invests for six months at a time at 3.5 % each time? This means George took the interest from the first investment transaction and included it in the principal for the second transaction. Round to…
Four years ago, Leroy invested $12,600.00. Today, he has $20,700.00. If Leroy earns the same annual rate implied from the past and current values of his invsetment, then in how many years from today does he expect to have exactly $50,600.00 O 7.20 years (plus or minus 0.05 years) 7.57 years (plus or minus 0.05 years) O 6.25 years (plus or minus 0.05 years) 11.20 years (plus or minus 0.05 years) None of the above is within .05 percentage points of the correct answer
D Two years ago, Reggie invested $19,900.00. Today, he has $21,600.00. If Reggie earns the same annual rate implied from the past and current values of his investment, then in how many years from today does he expect to have exactly $38,000.00 O 0.00 years (plus or minus 0.05 years O 15.78 years (plus or minus 0.05 years O 22.35 years (plus or minus 0.05 years O 13.78 years (plus or minus 0.05 years O None of the above is within .05 percentage points of the correct answer
Bert plans to invest $5,120.00 in 3 years and $3,970.00 in 5 years. He expects to earn 8.59 percent per year. How much money does Bert expect to have in 11 years? O $15,822.62 (plus or minus 10 dollars) O $11,077.78 (plus or minus 10 dollars) O $16,408.17 (plus or minus 10 dollars) O $14,911.77 (plus or minus 10 dollars) O none of the answers are within 10 dollars of the correct answer

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