withdrawal is to be made 5 years from now, how long will it take for the fund to be depleted?

Q: An investment offers $12,000 per year for 20 years, with the first payment occurring one year from…

A: The time value of money concept holds the utmost relevance while determining the future value and…

Q: Approximately what interest rate is needed to double an investment over eight years?

A: In the given question we require to compute the interest rate which will make our investment double…

Q: Six annual regular payments of £7,250 are paid into a fund that pays interest of 3.4% per annum.…

A: In stock market, the change in the market rate of interest can be seen. With the change in interest…

Q: A loan of $50,000 is due 10 years from today. The borrower wants to make monthly payments at the end…

A: The payments made constantly without any uneven time gap are called annuity where nominal amount for…

Q: What is the present value if $200 to be received 8 years from now if money in hand can be invested…

A: present value if $200 to be received 8 years from now if money in hand can be invested at 12% can be…

Q: ear investment yields a total return of 16.2%, and t yields a total return of 28.5%. If an initial…

A: Formulate the Problem:Objective function: Maximize…

Q: How much money will be in s bank account after thress years, if the account pays 6% inerest…

A: Future value is that amount which will be require to paid at some specified period of time. It…

Q: An investment product promises to pay $500 at the end of the fifth year (year 5), and the payment…

A: Perpetuity:It shows the present value of the cash flows which are payable at equal intervals…

Q: A continuous annuity of $12,000 per year is to be funded by steady withdrawals from a savings…

A: Annuity Amount = 12,000 per year Interest Rate = 6% Continuous Compounding

Q: Calculate the time necessary to achieve an investment goal. Give your answer to the nearest day. Use…

A: In this we have to determine the daily interest rate and from that we can get time required to…

Q: In order to create an endowment, which pays Rs 500,000 per year, forever, how much money must be set…

A: Formula to calculate the present value is: PV = FV/(1+i)^n Where PV is the present value, FV is the…

Q: You are planning to deposit in saving account $25000 three years from now, $35000 in the fourth…

A: Time value of money concept says that an amount invested today will have more value in future due to…

Q: A pension fund must pay out $1 million next year, $2 million the following year, and then $3 million…

A: Solution:Duration refers to that point of time where reinvestment risk equalizes the interest rate…

Q: A small company wishes to set up a fund th can be used for technology purchases over the next 6…

A: When the annuity amount is growing at a constant rate, present value of growing annuity formula is…

Q: saver wants $100000 after 10 years and believes it is possible to earn an annual rate of 8% on…

A: Amount required = FV = $100,000No of years = nper = 10 yearsInterest rate = rate = 8%Yearly…

Q: An award is being established, and it will pay $11,000 every two years, with the first installment…

A: Perpetuity is a concept in finance where the cash flows would be forever & has no end. This…

Q: Approximately what rate is needed to double an investment over five years?

A: In this question we need to compute the rate which will make the investment double in five years.

Q: Using a 5% annual compound interest rate, what investment today is needed in order to withdraw…

A:

Q: A fund is to be created which pays out a scholarship of £7,000 every year in perpetuity. The first…

A: Perpetuity are funds that are paid over the whole life period of annuities. Value of perpetuity is…

Q: How much is an asset with expected annual cashflows of $19,000 for 11 years worth today, if the…

A: Present value considers the time value of money concept. It considers the discounting factor at…

Q: A pension fund must pay out $1 million next year, $2 million the following year, and then $3 million…

A: A concept that implies the future worth of the money is lower than its current value due to several…

Amortized Loans

The term "amortization" refers to spreading the value of a loan or a debt over a series of regular payments or installments comprising of both the principal and interest amount. It generally involves the process where in the value of a loan or an intangible asset is written down over its maturity period.