Two years ago, Kevin invested $9,400.00. Today, he has $10,800.00. If Kevin 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 $40,700.00 O 19.11 years (plus or minus 0.05 years) O 21.11 years (plus or minus 0.05 years) O 13.91 years (plus or minus 0.05 years) O 29.07 years (plus or minus 0.05 years) O None of the above is within .05 percentage points of the correct answer

Two years ago, Kevin invested $9,400.00. Today, he has $10,800.00. If Kevin 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 $40,700.00 O 19.11 years (plus or minus 0.05 years) O 21.11 years (plus or minus 0.05 years) O 13.91 years (plus or minus 0.05 years) O 29.07 years (plus or minus 0.05 years) O None of the above is within .05 percentage points of the correct answer

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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Franklin owes the following amounts to the same person: $16,000 due today, $11,500 due in 1¼ years, $17,000 due in 2¾ years, and $15,000 due in 4¼ years. He wants to make a single payment of $56,500 instead. Using an interest rate of 8% compounded quarterly, when should this payment be made?
How much should chuck invest semiannually in his ira to have $250,000 in it when he retires in 25 years, if the interest stays 11% compounded semiannually?
Brodie receives $500 every 12 months forever, starting 20 months from today. If his stated annual interest rate is 14% compounded monthly, what is the present value of this perpetuity? a. $3,600 b. $3,000 c. $3,250 d. $3,350 e. $3,050
Your great-uncle Claude is 82 years old. Over the years, he has accumulated savings of $180,000. He estimates that he will live another 18 years at the most and wants to spend his savings by then. (If he lives longer than that, he figures you will be happy to take care of him.) Uncle Claude places his $180,000 into an account earning 9 percent annually and sets it up in such a way that he will be making 18 equal annual withdrawals—the first one occurring one year from now—such that his account balance will be zero at the end of 18 years. How much will he be able to withdraw each year?
Paul intends to retire in 15 years and would like to receive $1,500 every month for 20 years, starting at the end of the first month in which he retires. How much must he have at the beginning of retirement if interest is 5% compounded annually? Select one: a. $191,834.03 b. $229,415.16 c. $228,235.00 d. $227,287.97 e. $230,349.83
Holden borrows $209,433 from a financial institution with equal end-of-year payments of $24,600. If the annual interest rate is 10%, how long will it take for him to pay the loan and its interest back? 10 years 15 years 20 years 25 years
Larry purchased an annuity from N insurance company that promises to pay him $2,000 per month for the rest of his life. Larry paid $210,240 for the annuity. Larry is in good health and is 72 years old. Larry received the first annuity payment of $2,000 this month. If Larry lives more than 15 years after starting the annuity, how much of each additional payment should be included in gross income?
Ed Long promised to pay his son $300 semiannually for 10 years. Assume Ed can invest his money at 6% in an ordinary annuity. How much must Ed invest today to pay his son $300 semiannually for 10 years?
Annette has just inherited $180,000. She invests this money at a rate of return of 6.47% per year compounded quarterly. After some period of time, she purchases an annuity that pays $2851 at the beginning of each month for 20 years. What monthly compounded rate of interest is equivalent to 6.47% compounded quarterly?
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…
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