You are willing to pay $15,625 now to purchase a perpetuity which will pay you and your heirs $1,350 each year, forever, starting at the end of this year. If you're required rate of return does not change, how much would you be willing to pay if this were a 20-year, annual payment, ordinary annuity instead of a perpetuity?

Q: Assume you borrow $30,000 today at a rate of 13%. The loan will be returned over a five-year period,…

A: To calculate the annual payment for a loan using a spreadsheet, use the PMT function in Microsoft…

Q: A person has made an arrangement to borrow $1,000 now and another $1,000 two years hence. The entire…

A: Interest charged on the principal amount and the interest accrued is known as Compound Interest. It…

Q: You have selected an account that yields 3.85% compounded monthly to invest the $4,051,948 that you…

A: The effective annual interest rate (EAR), also called the annual percentage yield, means the true…

Q: Calculate the present value of a sequence of payments of $1000 made at the beginning of every four…

A: Present value (PV) is the current value of a future payment or series of payments, discounted at a…

Q: In one instance, a financial institution loaned you $60,000 for two years at an APR of 5.75% for…

A: First instance: Given , Principal = $60000 APR = 5.75% Time period = 2 years Thus, simple interest =…

Q: You are going to get %10,000,000 in 45 years' time. What is the value of that money today assuming…

A: Present value can be calculated by using the following formula.

Q: Two annuity dues in perpetuity have a common present value of $2, 000 and a common effective annual…

A: Annuity: An annuity is a finance product that enables you to receive a fixed payout for the rest of…

Q: How many years will it take an investment to triple if the interest rate is 6% compounded…

A: Given: Future value = 3 * Present value Thus FV = 3PV Interest rate (i) = 0.06 Time (t) = ?

Q: Tamara Massey received $1,500,000 from an insurance company after her husband's death. She wants to…

A: Interest rate per month can be calculated as follows: Thus, the interest rate is 0.67%

Q: How many months will it take to pay off a $525 debt, with monthly payments of $15 at the end of each…

A: Mortgage installments are regular payments made by borrowers to lenders to repay a mortgage loan.…

Q: A child’s grandparents have opened a ₱586702 savings account for the child on the day of her birth.…

A: It is given in the question that, Principal amount(P)=5,86,702. Interest rate(i)=1.7% or 0.017…

Q: What is the accumulated amount of a 8-year annuity paying ₱ 1,067 at the end of each year, with…

A:

Q: consider yourself unable to pay this month's rent due to financial issues. A Money lending company…

A: * Annual interest rate = per month interest rate * 12 * Effective annual interest rate : Here we…

Q: What rate of interest compounded annually would result in receipt of $22,110 in seven years from…

A: Compound interest will be computed by multiplying the present value amount by one plus the annual…

Q: What is the amount of interest earned on $5,000 for eight years at 10% simple interest per year?

A: Since, you have asked more than one question, we will be answering the first one for you. If you…

Q: How many years will it take an investment to triple if the interest rate is 8% compounded annually…

A: When an amount is compounded annually, interest keeps added on for the compounding year after year.

Q: The nominal interest rate is 14% compounded semiannually. What amount will need to be deposited…

A: Cash flow:The sum of the total money is represented in the diagram. It represents the magnitude and…

Q: Suppose you owe $1,100 on your credit card. The annual percentage rate (APR) is 18%, compounded…

A: Cash flow:The sum of the total money is represented in the diagram. It represents the magnitude and…

Q: Assuming an interest rate of 8% compounded annually, how much money will be required in four years…

A: A = P(1+r)n where P is principal amountr is interest rate n is time period

Q: Find the present value of a deferred annuity of P6362 every six months for 3 years that is deferred…

A: Given  deferred annuity (A) =6362 every six months Time =3 years rate of interest =4% compounded…

Q: Consider the following two cash flow series of payments: Series A is a geometric series increasing…

A: The present worth (PW) represents the current or present value of a series of future cash flows,…

Q: If you borrowed $32,000 for 72 months at 16.5% with an add-on loan, what would be your monthly…

A: Principal Amount ((P)) = $32,000- Annual Interest Rate ((r)) = 16.5%- The loan term ((t)) is 72…

Q: An increasing annual uniform gradient series ends at the end of fifteenth year. What is the value of…

A: Present value of uniform inflow = Value of increasing annual uniform gradient series for 15 year For…

Q: On January 1, 2005, a person’s savings account was worth $200,000. Every month thereafter, this…

A: Part 2: Explanation:Step 1: Calculate the Future Value (FV) using the formula for compound…

Q: ind the equivalent effective interest rate of 6.05% when compounded continuously.   Write your…

A: Given  nominal interest rate i=6.05% compounded continuously. We have to calculate the equivalent…

Q: Suppose you want to withdraw $30,000 at the end of year 3 and another $30,000 at the end of year 5.…

A: When money is put somewhere, interest is accrued. Principal value refers to the original deposit,…

Q: You were released from your current job and received a settlement of $54,000. The Canada Revenue…

A:

Q: What is the accumulated amount of a 10-year annuity paying ₱ 1,744 at the end of each year, with…

A: Given information: Time, n = 10 years Annuity = 1744 Interest amount, r = 4%

Q: Compound interest is a very powerful way to save for your retirement. Saving a little and giving it…

A: Formula for the future value of annuity is given as:

Q: In 1895, the first U.S. Open Golf Championship was held. The winner’s prize money was $150. In 2016,…

A: Compounded Annual Growth Rate: If an investment is growing or increases at a compounded interest…

Q: James is offered an investment opportunity with the guarantee that his investment will quadruple in…

A: The rate of interest is the amount imposed over and above the principal amount by the lender from…

Q: $500 grows to $1,500 over a certain period and interest rate, what will be the present value of…

A: Present value represents the current worth of a sum of money that is to be received or paid in the…

Q: A cash flow at time zero (now) of $14,551 is equivalent to another cash flow that is an EOY annuity…

A: A Cash flow at time zero (but now it is $14,551) is equivalent to another cash flow that is an…

Q: You are going to borrow $30,000 to purchase a car.  You agree to repay the loan in 36 monthly…

A: The nominal interest rate is the rate of interest charged on the loan amount. It is the sum total of…

Q: ow much did you deposit at the end of each month in an IRA that pays 7% compounded monthly to earn…

A: In this question, we have to calculate the monthly deposit (A) for 30 years.  Rate of interest =7%…

Q: If the interest rate is 7% compounded continuously, what is the required quarterly payment to repay…

A: Interest is the cost of capital. We can use interest in the context of either borrowed funds,…

Q: What sum deposited today at 9% compounded annually for 18 years will provide the same amount as…

A: Formula for the future annuity is given as: F = A (1+R)t-1RFormula for the presnet value P =…

Q: Maria deposits $1,300 in a savings account that pays interest at an annual compound rate of 4.0%.…

A: Interest rate refers to the percentage of the principal amount that a lender charges a borrower for…

Q: Find that how much must be invested at the end of every year at 11% so that $15,000 will be…

A: Given: Future Value (F.V.) = $15,000 Annual interest rate (r) = 11% = 0.11% Time in years = 5 years…

Q: the pre inuity vith monthly deposits of $2,000 at 5% for 0 years. -iscuss how the present value of…

A: Present value is the concept that states an amount of money today is worth more than that same…