you have won a sweepstake that gives you 12 annual installments of $25,000 with the furst ine to be recieved a year from today. if the annual discouting rate is 8% what is the presbt value (today) of these 12 cash flow installments?
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you have won a sweepstake that gives you 12 annual installments of $25,000 with the furst ine to be recieved a year from today. if the annual discouting rate is 8% what is the presbt value (today) of these 12 cash flow installments?
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- 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.Suppose an annuity will pay $14,000 at the beginning of each year for the next 5 years. How much money is needed to start this annuity if it earns 6.5%, compounded annually? (Round your answer to the nearest cent.)$_____You can invest $5,000 today in an account that earns an annual interest rate of 8%. Using the formula for the future value of a lump sum, calculate the amount you'll have in this account after five years.
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- If you put up $73,000 today in exchange for an annual 6.75 percent, 18-year annuity, what will the annual cash flow be?The student who wins the Fancy Est Sunglasses Contest will receive a cash prize each year. The source of the prize money is a perpetuity that bears interest at 2% compounded monthly. The prize money is paid out in fixed amounts every year starting from one year. If my initial deposit is $2,000, what is the value of the prize? Please round your answer to the nearest cent.At the end of each of the next 8 years, you planto put $25,000 of your annual salary in thebank. If the annual interest rate is 3%, what isthe present value of this planned savingsstream? What will the balance in your bankaccount be at the end of the 8 year period?
- Answer the following problems. Show your solutions. Annuity 1. How much money will you accumulate by the end of year 10 if you deposit P 3,000 each for the next ten years in a savings account that earns 5% per year? 2. What deposit made at the beginning of each month will accumulate to P120,000 at 8% compounded semi-annually at the end of 10 years? 3. James deposited P150 at the beginning of each month for two years into his savings account. For the next four years he did not make any more deposits, leaving the money in the account. The bank charges 4% interest compounded monthly. What will the balance be after 12 years?What is the present value of $4,000 paid each year forever, assuming a discount rate of 7% and the first payment occurs one year from now?As part of your retirement plan, you have decided to deposit $9,000 at the beginning of each year into an account paying 5% interest compounded annually. (Round your answers to the nearest cent.) Explain A-E (a) How much (in $) would the account be worth after 10 years? $ (b) How much (in $) would the account be worth after 20 years? $ (c) When you retire in 30 years, what will be the total worth (in $) of the account? $ (d) If you found a bank that paid 6% interest compounded annually rather than 5%, how much (in $) would you have in the account after 30 years? $ (e) Use the future value of an annuity due formula to calculate how much (in $) you would have in the account after 30 years if the bank in part (d) switched from annual compounding to monthly compounding and you deposited $750 at the beginning of each month instead of $9,000 at the beginning of each year. $
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