Question

9. Items 65 through apply to be future value factors for l based on interest compounded w o of interest tables Given below are the ve periods. Each of the items 65 to 68 is ally. Periods 8 Future Value of 1 1.080 1.166 1.260 1.360 1.469 What amount should be deposited in a bank account today to grow to $25,000 three years from today? A) $25,000 1.260 B) S25,000 x 1.260 * 3 C) $25,000 + 1.260 D) $25,000+ 1.080 x 3 10. Items 65 through 68 apply to the appropriate use of interest tables. Given below are the future value factors for 1 at 8% for one to five periods. Each of the items 65 to 68 is based on 8% interest compounded annually. Periods Future Value of 1 at 8% 1.080 1.166 1.260 1.360 1.469 What amount will be in a bank account three years from now if $10,000 is invested each year for four years with the first investment to be made today? A) ($10,000 x 1.260) + ($10,000 ~ 1.166) + ($10,000 x 1.080) + $10,000 B) $10,000 x 1.360 x 4 C) ($10,000 x 1.080) + ($10,000 x 1.166) + ($10,000 x 1.260) + ($10,000 x 1.360) D) $10,000 x 1.080 x 4

Answer 1

Amount to be invested today to get $25000, 3 years from now is: $25,000 = 1.260 Hence, option C. is the correct option. 10. Amount in bank account if $10,000 is deposited each year @ 8% 1 =10000*1.08 2 =10000*1.166 3 =10000*1.26 4 =10000*1.36 =SUM(A1:A4) 6 SUM(number1, [number2],...) Hence, option C. is the correct option.