The Bricks sells a couch for $1200. It can be purchased for $300 as down and no payment for 3months. At the end of the 3rd month, you can make your first payment and continue paying for 1year and 6 months. Determine the size of each payment if the interest rate is j12=18%. a) Thisquestion deals with thevalue of an annuity+ . b)The present value ofthe couch is $c)The first payment is due on+ month. d)The number of paymentperiods ise) The size of each payment is $

We are going to use Present Value of money concept to answer this question.

Answered: The Bricks sells a couch for $1200. It…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Student Loans Willie Wilson plans to borrow $36,627 at the beginning of each of his 4 years of college. He will repay the loan in 14 equal annual installments at the end of each year starting one year after he graduates. If the interest rate is 10.38%, how large will the installments be? Interest will accrue on Willie's loan while he is in college. Numeric Response
If you invest $2,000 today, withdraw $1,000 in 3 years, deposit $3,000 in 5 years, deposit $1,500 in 8 years, and withdraw the entire sum three years after the final deposit, how much will you withdraw? Interest is 7%.
A series of equal semi-annual payments of $1,500 for 3 years is equivalent to what present amount at an interest rate of 12%, compounded annually? (All answers are rounded to nearest dollars.)
The problem describes a debt to be amortized. (Round your answers to the nearest cent.) A man buys a house for $350,000. He makes a $150,000 down payment and amortizes the rest of the purchase price with semiannual payments over the next 12 years. The interest rate on the debt is 8%, compounded semiannually. (a) Find the size of each payment. $ (b) Find the total amount paid for the purchase. $ (c) Find the total interest paid over the life of the loan. $
You want to buy a $13,000 car. The company is offering a 2% interest rate for 60 months (5 years). What will your monthly payments be? > Next Question
Sally purchases a perpetuity immediate with annual payments that pays $4000 today and Payments increase by 5% per year. She will pay for it with a single payment exactly 6 years from today. Assume a constant force of interest of 7%. Calculate the size of the payment at time 6.
Help ( economics) not finance
QUESTION 2 1. You need $30,000 to buy a new Air-Con for your house in 4 years. What value you must have now if the compounded annually return is 10%. 2. Your father placed $50,000 in a trust fund for you. In 12 years what will be the worth of the savings. If the estimated rate of return on the trust fund is 7%?
2.5 To purchase a new truck, you borrow $42,000. The bank offers an interest rate of 7.5% compounded monthly. If you take a 5-year loan and you will be making monthly payments, what is the total amount that must be paid back? a. What is the number of time periods (n) you should use in solving this problem? b. What rate of interest (i), per period of time, should be used in solving this problem?
Ordinary annuity payment. Fill in the missing annuity in the following table for an ordinary annuity stream: Number of Payments or Years 6 21 33 15 Annual Interest Rate 9% 4% 6% 10% Future Value $0.00 $24,000.00 $0.00 $98,433.34 Annuity (Round to the nearest cent.) $ (Round to the nearest cent.) $(Round to the nearest cent.) (Round to the nearest cent.) Present Value $24,000.00 $0.00 $150,000.00 $0.00
Question 1 Due to health reasons, Dave is considering early retirement. He currently has $700,000 in a self- managed retirement fund. He thinks he will need S40,000 per year during retirement. He intends to invest his retirement in a low-risk mutual fund which return 1.5% per year. How many years can he live off this retirement fund without the need to look for a job?
A student is buying an automobile that costs $12,000 and she will borrow the money from a bank, and pay the loan off in five annual instalments. At 15% interest rate, what is the installment amount ? Prepare a cash flow diagram to represent this situation. $12000 15% 5 years 0 1 2 3 4 A A A A A

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