Today $5000 is deposited in an account that earns 2.5% per quarter. Additional deposits are made at the end of every quarter for the next 20 years. The deposits start at $100 and increase by $50 each year thereafter. The amount that has accumulated in this account at the end of 20 years can be expressed as follows. (a) = 5000(P/F, 2.5%, 20) + 100(F/A, 2.5%, 20%) + 50 (P/G, 2.5%, 20 − 1) (b) = 5000(F/P, 10%, 80) + 150(P/G, 10%, 80) (F /P = 10%, 80) (c) = 5000(P/F, 10.38%, 20) + 100(P /A, 10.38%, 20) + 50(P/G, 10.38%, 20)(P/F, 10.38%, 1) (d) = 5000(F/P, 10.38%, 80) + 100(F/A, 2.5%, 80) + 50(P/G, 2.5%, 80) (F/P, 2.5%, 80).
Today $5000 is deposited in an account that earns 2.5% per quarter. Additional deposits are made at the end of every quarter for the next 20 years. The deposits start at $100 and increase by $50 each year thereafter. The amount that has accumulated in this account at the end of 20 years can be expressed as follows. (a) = 5000(P/F, 2.5%, 20) + 100(F/A, 2.5%, 20%) + 50 (P/G, 2.5%, 20 − 1) (b) = 5000(F/P, 10%, 80) + 150(P/G, 10%, 80) (F /P = 10%, 80) (c) = 5000(P/F, 10.38%, 20) + 100(P /A, 10.38%, 20) + 50(P/G, 10.38%, 20)(P/F, 10.38%, 1) (d) = 5000(F/P, 10.38%, 80) + 100(F/A, 2.5%, 80) + 50(P/G, 2.5%, 80) (F/P, 2.5%, 80).
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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Today $5000 is deposited in an account that earns 2.5% per quarter. Additional deposits are made at the end of every quarter for the next 20 years. The deposits start at $100 and increase by $50 each year thereafter. The amount that has accumulated in this account at the end of 20 years can be expressed as follows. (a) = 5000(P/F, 2.5%, 20) + 100(F/A, 2.5%, 20%) + 50 (P/G, 2.5%, 20 − 1) (b) = 5000(F/P, 10%, 80) + 150(P/G, 10%, 80) (F /P = 10%, 80) (c) = 5000(P/F, 10.38%, 20) + 100(P /A, 10.38%, 20) + 50(P/G, 10.38%, 20)(P/F, 10.38%, 1) (d) = 5000(F/P, 10.38%, 80) + 100(F/A, 2.5%, 80) + 50(P/G, 2.5%, 80) (F/P, 2.5%, 80).
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