Your bank pays 8.00 percent annual interest compounded semiannually on your savings account. You don't expect to add to thecurrent balance of $2,200 over the next four years. How much money can you expect to have at the end of this period? (If you solve thisproblem with algebra round intermediate calculations to 6 decimal places, in all cases round your final answer to the nearest penny.)Value of investment after 4 years$

Step 1: Given Value for Calculation Compound = Semiannually = 2Interest rate = r = 8 / 2 = 4%Present…

Answered: Your bank pays 8.00 percent annual…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Similar questions

You want to have $60,000 in your savings account 12 years from now, and you're prepared to make equal annual deposits into the account at the end of each year. If the account pays 6.4 percent interest, what amount must you deposit each year? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Deposit amount
You plan to deposit $5,500 at the end of each of the next 15 years into an account paying 11.3 percent interest. a. How much money will you have in the account in 15 years? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. How much will you have if you make deposits for 30 years? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) a. Future value of 15 deposits b. Future value of 30 deposits
Assume that you need $1,000 four years from today. Your bank compoundsinterest at an 8 percent annual rate. a.How much must you deposit one year from today to have a balance of$1,000 in your account four years from today? b.If you want to make equal payments each year, how large must each of thefour payments be if the first deposit is made one year from today? c.If your father were to offer either to make the payments calculated in part(b) ($221.92) or to give you a lump sum of $750 in one year, which wouldyou choose? d.If you have only $750 in one year, what interest rate, compounded annually,would you have to earn to have the necessary $1,000 four years from today? e.Suppose you can deposit only $186.29 each for the next four years, begin-ning in one year, but you still need $1,000 in four years. At what interestrate, with annual compounding, must you invest to achieve your goal? f. To help you reach your $1000 goal, your father offers to give you $400 in one year. You will get…
Suppose you want to withdraw $20,000 at the end of year 3 and another $20,000 at the end of year 5. The account's interest rate is 5% compounded annually. A How much should you deposit now? B) Suppose you realize you can only deposit $10,000 today, but you expect to have more funds available in 1 year. How much must you deposit into the account at the end of year 1 so that you can still make the necessary withdrawals at the end of years 3 and 5?
You want to be able to withdraw $4500 from an account at the end of each 6-month period (that is, twice a year) for the next 11 years. How much money should you invest now into an account earning 4.1% interest per year, compounded every 6 months, in order to fund the desired withdrawals? Assume the account is empty after the last withdrawal is made. Give the answer correctly to 2 decimal places. The amount to invest now is ______ dollars.
5. You take $100 to your local savings bank to invest for five years. You are given the choice of two investments by the banker Notifications Time Left 00:00:28 ? Guide Me 1. You can Invest in a regular savings account that pays you 14.00% interest each year with interest compounded annually. That is each year the interest you can gets deposited in your bank account and earns interest until the end of the five years. it. You can invest in a special account that pays you 20.00% interest each year, the catch is that the interest does not compound, Rattier each year the interest payrrient is put into a special account which collects no further interest and cannot be reinvested anywhere until the end of the five years Which option should you select and why? a, Select Option i: It earns $44.63 more than Optianill b. Both Options earn you the same amount of money so you are indifferent between the two c. Select Option it It earns $7.46 more than Option d. Select Option it It earns $30.00…
← Suppose you start saving today for a $45,000 down payment that you plan to make on a house in 6 years. Assume that you make no deposits into the account after the initial deposit. For the account described below, how much would you have to deposit now to reach your $45,000 goal in 6 years. An account with daily compounding and an APR of 4% D You should invest $ (Do not round until the final answer. Then round to two decimal places as needed.)
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You have decided to open a savings account and put $9000 in your local bank at an interest rate of 0.6% APR, which is compounded monthly. About how much money will you have in the saving account at the end of 8 years. $______________________________________________
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Suppose your parents deposit $4,000 into an account at the end of each year for 11 years. The account earns an annual interest rate of 1.4%. After the final deposit, they move the accumulated savings to a brokerage account and invest in the stock market, where they earn an average annual return of 6.9% for the following 16 years. How much will they have in the account at the end? O a. $131,280 O b. $404,155 O c. $137,311 O d. $296,336 e. $302,138 f. $279,603 g. $496,270 h. $249,511

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