Financial Accounting Today, you deposit $6,000 into an account thatpays 10 percent annually. In one year, you willldeposit another $4,000 in the account. How muchwill you have in the account after two years?a. $10,600b. $10,000c. $11,660d. $11,000

Step 1: Define Future ValueThe future value of an investment indicates how much cash flows generated…

Answered: Today, you deposit $6,000 into an…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 25P

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You want to invest $8,000 at an annual Interest rate of 8% that compounds annually for 12 years. Which table will help you determine the value of your account at the end of 12 years? A. future value of one dollar ($1) B. present value of one dollar ($1) C. future value of an ordinary annuity D. present value of an ordinary annuity
You put $250 in the bank for S years at 12%. A. If interest is added at the end of the year, how much will you have in the bank after one year? Calculate the amount you will have in the bank at the end of year two and continue to calculate all the way to the end of the fifth year. B. Use the future value of $1 table in Appendix B and verity that your answer is correct.
You put $600 in the bank for 3 years at 15%. A. If Interest Is added at the end of the year, how much will you have in the bank after one year? Calculate the amount you will have in the bank at the end of year two and continue to calculate all the way to the end of the third year. B. Use the future value of $1 table In Appendix B and verify that your answer is correct.
How much must be invested now to receive $50,000 for 8 years if the first $50,000 is received in one year and the rate is 10%?
Use the tables in Appendix B to answer the following questions. A. If you would like to accumulate $4,200 over the next 6 years when the interest rate is 8%, how much do you need to deposit in the account? B. If you place $8,700 in a savings account, how much will you have at the end of 12 years with an interest rate of 8%? C. You invest $2,000 per year, at the end of the year, for 20 years at 10% interest. How much will you have at the end of 20 years? D. You win the lottery and can either receive $500,000 as a lump sum or $60,000 per year for 20 years. Assuming you can earn 3% interest, which do you recommend and why?
You want to accumulate $1 million by your retirement date, which is 25 years from now. You will make 25 deposits in your bank, with the first occurring today. The bank pays 8% interest, compounded annually. You expect to receive annual raises of 3%, which will offset inflation, and you will let the amount you deposit each year also grow by 3% (i.e., your second deposit will be 3% greater than your first, the third will be 3% greater than the second, etc.). How much must your first deposit be if you are to meet your goal?
Use the tables in Appendix B to answer the following questions. A. If you would like to accumulate $2,500 over the next 4 years when the interest rate is 15%, how much do you need to deposit in the account? B. If you place $6,200 in a savings account, how much will you have at the end of 7 years with a 12% interest rate? C. You invest $8,000 per year for 10 years at 12% interest, how much will you have at the end of 10 years? D. You win the lottery and can either receive $750,000 as a lump sum or $50,000 per year for 20 years. Assuming you can earn 8% interest, which do you recommend and why?
Suppose you deposit $100 today in an account paying 8 percent. In oneyear, you will deposit another $100. How much will you have in two years?
Suppose you deposit $1,681.00 into an account today that earns 11.00% p.a. It will take years for the account to be worth $2,936.00.
How much must you deposit into an account today so that you can have $20,000 in twelve years? Assume that the account earns 6% per year compounded quarterly. You should deposit $
You will receive $1,000 forever starting from the end of next year. The account pays 10% compounded annually. What is the present value today?A. 1,000B. 9,091C. 10,000
1. If you deposit $28,688 annually at the end of every year in a bank account paying 5% annually, how much would you have saved at the end of ten years? Round your answer to the nearest one dollar.

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Today, you deposit $6,000 into an account that pays 10 percent annually. In one year, you willl deposit another $4,000 in the account. How much will you have in the account after two years? a. $10,600 b. $10,000 c. $11,660 d. $11,000