Need answer general Accounting question You invest $7,500 today at an annual interest rate of 7%.Calculate how much you will have after 5 years.

Step 1: Define Time Value of Money (TVM)The Time Value of Money (TVM) is the financial concept that…

Answered: You invest $7,500 today at an annual…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 6MC: You want to invest $8,000 at an annual Interest rate of 8% that compounds annually for 12 years....

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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?
Calculating interest earned and future value of savings account. If you put 6,000 in a savings account that pays interest at the rate of 3 percent, compounded annually, how much will you have in five years? (Hint: Use the future value formula.) How much interest will you earn during the five years? If you put 6,000 each year into a savings account that pays interest at the rate of 4 percent a year, how much would you have after five years?
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 that you have $100 to invest for a period of 5 years at an interest rate of 10% per year. How much will you have accumulated at the end of this time period?
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.
You plan to invest $2,000 per year into a retirement account. If you earn a compound annual rate of return of 5%, how many years will it take you to reach a balance of $500,000?
You will require $730 in 5 years. If you earn 5% interest on your funds, how much will you need to invest today in order to reach your savings goal?
Suppose you invest $3,500 today, compounded monthly, with an annual interest rate of 8.50%. What amount of interest will you earn in one year?
If you need 6,000 5 years from now, how much of a deposit must you make in your savings account each year, assuming an 8 percent annual interest rate?
You will receive a cash payment of $6.4 in 4 years. If the relevant interest rate is 16.4%, how much is it worth today? Answer:
You invest $150 each month in a savings plan for a period of 30 years. If you earn an interest rate of 7.5% over that time how much money would you have accumulated and How much money would you have deposited?
If you want to receive $1,000 each year for the next three years how much should you invest today? Assume the annual interest rate to be 10%.

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You invest $7,500 today at an annual interest rate of 7%. Calculate how much you will have after 5 years.