You want to go to Europe 5 years from now, and you can save RM3,100 per year, beginning one year from today. You plan to deposit the funds in a mutual fund that you think will return 8.5% per year. Under these conditions, how much would you have just after you make the 5th deposit, 5 years from now?

Q: You are planning on traveling to Australia and New Zealand 3 years from now and you can save $2,700…

A: Future value of ordinary annuity is calculated when regular payments are made at the end of each…

Q: Calculate  time value of money : If I am to receive $10k in 5 years, given a 5% rate of return, what…

A: Time value of money helps the management for decision making. as the value of money, today is high…

Q: What is the present value of the payments if they are in the form of an ordinary annuity? What is…

A: The present value can be calculated as follows : Calculations for above :

Q: You can invest in a mutual fund that generates 9% return per year. If you want to have $700,000 in…

A: The amount that a present investment will gain in value over time when kept in a compound interest…

Q: You invest 800 into an account 1 year from today. Each subsequent year you invest 400 more than the…

A: At an interest rate of 8% with 800 investment amount for 1 year and subsequent 400 year amount for…

Q: You are considering an investment that requires you to spend $150,000 today and receive $200,000 in…

A: Given Investment Amount = $150,000 Maturity Value= $200,000 Cost of Fund from Bank(With Collateral)=…

Q: You are considering investing in a European bank account that pays a nominal annual rate of 8%,…

A: Solution:-When an equal amount is invested each periodat beginning of period, it is known as annuity…

Q: 8) Special Retirement PlanYou set up a retirement plan where you will invest $20,000 per year in an…

A: Annuity is the payment series which are made at equal time intervals.

Q: You decide to invest $14.4k today into a security that will make fixed annual payments to you of…

A: The money's present value is its current worth compared to some of its potential future value after…

Q: A new investment opportunity for you is an annuity that pays $560 at the beginning of each year for…

A: Annual payment (P) = $560Interest rate (r) = 5.4% or 0.054Payment time = BeginningNumber of years…

Q: Present Value You will require $700 in 5 years. If you earn 5% interst on your funds, how much will…

A: The computation is as follows: Hence the present value is $548.47.

Q: You are offered an investment that will pay you (and your heirs) €40,000 income per year forever,…

A: Annual income forever = €40,00 Annual interest rate = 8%

Q: You’ve received a bonus of R104,613.95 at work and want to invest the money so you can afford a new…

A: The worth of money in future is calculated using the following formula:

Q: i. Would you be willing to pay RM25,000 today in exchange for a lump sum of RM100,000 in 30 years…

A: Future value = RM 100,000 Current proposed payment = RM 25,000 Annual interest rate = 8% Period = 30…

Q: If you invest $10,000 in a savings account that earns 5% interest per year, how much will you have…

A: Investment amount = $10,000Interest rate = 5%Period = 10 years

Q: Suppose you want to have S0.5 million saved by the time you reach age 30, and suppose you are 20…

A: Future value of the investment (FV) = $500000 Number of years of investment (n) = 10 Rate of…

Q: You have a chance to buy an annuity that pays Php2,500 at the end of each year for 3 years. You…

A: An annuity is a type of security that pays periodic payments over a specified period of time. In…

Q: You own a hotel that you will receive EURO. 150,000 in rental income for next year. The rent will be…

A: Solution:- When an equal amount is receivable each period with a constant growth rate over a number…

Q: Consider the following situation, which requires comparison of options.Cousin Thaddeus offers to pay…

A: Annuities are insurance contracts that promise to pay you regular income either immediately or in…

Q: You would like to take a trip in 10 years that is expected to cost $55,000 at that time. If you can…

A: Present value of future amount is computed byfollowing formula-PV =  A ÷ ( 1+r)nWhere,PV = Present…

Q: Moe's Life Insurance Co. is trying to sell you an investment policy that will pay you and your heirs…

A: Given details are : Annual cash flow for forever = $15000 Required return = 9% We need to compute…

Q: Suppose someone needs dollars 8969 in his account 5 years from now and the required rate of return…

A: Amount - 8969 Time - 5 years Rate of return - 0.1 per year compounded continuously

Q: You just won the TVM Lottery. You will receive $1 million today plus another 10 annual payments that…

A: Present value defines the current value of an asset that will be present at sone futrue date…

Q: Elon Musk asks you to invest $10M in his new cyber scooter product. He promises that he will return…

A: Future value (FV) may be a money related concept that measures the worth of an speculation or…

Q: If you invest £150 at 4% for 11 years how much money would you have at the end of the investment…

A: Future Value of ordinary annuity=Annuity×1+ratetime-1rate Present Value Annuity…

Q: Suppose you are committed to owning a $346,000 Ferrari. If you believe your mutual fund can achieve…

A: The time value of money is the concept that money received today is worth more than the same amount…

Q: ered by a bank an interest rate of 6.5% per annum, compounded annually. How much money will the…

A: The given problem can be solved using PV function in excel. PV function computes present worth for…

Q: 4.2 Calculating Present Values Suppose you have just celebrated your 19th birthday. A rich uncle set…

A: The worth of the fund today can be calculated with the help of present value function

Q: Wells Fargo offers a new savings product: You make the following payments over the next 5 years and…

A: The FV of an investment refers to the cumulative worth of the investment's cash flows at a future…

Q: How much must I start investing now, per month, to have $1M in 25 years? The bank pays an APR of…

A: Present value refers to the current valuation for a future sum. Investors determine the present…

Q: You are 19 years old today. You want to have $381,507.06 in an investment acce when you are 60 years…

A: Future value of money include the growth of money and interest also. so future value become…

Q: You expect to receive $150,000 per year on a contract that will last 5 years. You are trying to…

A: Present value of future cash inflows will be equal to the worth of contract today.   Worth of…

Q: You are going to buy an apartment, and are borrowing 5 000 000 from a bank for 10 years. The…

A: EAR is the effective interest rate that is interest rate after considering impact of compounding on…

Q: You just inherited some money, and a broker offers to sell you an annuity that pays Php5,000 at the…

A: Time value of money is a financial concept which is used to calculate the value of money in present…

Q: ou are promised 5 (yearly) payments of 500 EUR from your fairy godmother. The first payment is…

A: We can compute the present value of all promised payments at the bank agreed interest rate of 3%.

Q: Jenny needs to borrow from you a P500 now, and will pay you back P570 in a year. Is that a good…

A: Answer) Calculation of Rate of Return on Investment Rate of return on investment = (Maturity amount…

Q: ou have just won the lottery and will receive $460,000 in one year. you will receive payments for 21…

A: Present value of growing annuity With annuity (PMT), periodic interest rate (r), growth (g) and…

Q: The Maybe Pay Life Insurance Company is trying to sell you an investment policy that will pay you…

A: Payment = p = $141,221Time = t = 9 YearsRequired Rate of Return = r = 12.16%

Q: you want to go to Europe 4 years from now, and you can save $3300 per year, beginning one year from…

A: Future value of annity , FV = PMT * ((1+r)^n - 1)/r Here,PMT = $3300r = 0.085n=4FV=?

Q: Calculate the PV when you plan to receive $5,000 in 5 years with a 10% discount rate. b) Calculate…

A: Time value of money concept explains that money received at present has higher worth than the same…

Q: You are considering two investment options. In option A, you have to invest RM4000 now and RM1000…

A: Conventional payback period is the total period which will payback the initial investment of a…