2. (30 points) You invest $x today at 8% APR compounded annually for 5 years (you...
2(30 points) You invest $x today at 8% APR compounded annually for 5 years (you invest only once). Your friend also invests some amount at the same time at 8% APR compounded annually for 5 years. However, she invests an additional amount equal to the accumulated interest at the end of each year. You both end up having the same amount at the end of 5 years. In order to achieve this, your initial investment must have been t times...
1. (30 points) There are two firms considering introducing a new product to the market. Each firm can either set a high price or low price for its product. If both set a low price the market will be shared between the two firms. In this case, each firm expects to make a profit of $2m. If one firm sets a high price while the other sets a low price, the former is expected to make $1m and the latter...
1] Assume you have $2,500 to invest today at 5% interest compounded annually Determine how much you will have accumulated in the account at the end of: a) 5 years b) 10 years 2] Assume instead an annuity of $2,500 (which means you will invest $2,500 per year) which will also be compounded at 5% interest annually. Determine how much you will have accumulated in the account at the end of (future value): (Note this problem is for an annuity...
What sum deposited today at 5% compounded annually for 8 years will provide the same amount as $2400 deposited at the end of each year for 8 years at 8% compounded annually? What sum would have to be deposited today at 5% interest compounded annually? (Round to the nearest cent.)
Assume you have $3,509 to invest today in an account paying 9% compounded annually. How many years will it take before you have $12,117 in your account? Enter your answer as: 12 Round your answer. Do not use a decimal point or any units.
You have $5800 to invest today at 11% interest compounded annually. a. Find how much you will have accumulated in the account at the end of (1) 6 years, (2) 12 years, and (3) 18 years. b. Use your findings in part a to calculate the amount of interest earned in (1) the first 6 years (years 1 to 6), (2) the second 6 years (years 7 to 12), and (3) the third 6 years (years 13 to 18). c....
You plan to invest in securities that pay 11.6%, compounded annually. If you invest $5,000 today, how many years will it take for your investment to grow to $9,140.20? a. 6.10 b. 4.73 c. 6.43 d. 4.18 e. 5.50
12. Compound interest. You invest $1000 in an account that pays 5% compounded annually. What is the balance after two years? 13. Compounding using different periods. You invest $2000 in an account that pays an APR of 6%. a. What is the value of the investment after three years if interest is compounded yearly? Round your
You must invest $200000. Market interest rates are 6% APR semi-annually compounded. What is the duration of this bond? Please show formulas and do not use financial calculator or excel. B. 3 years to maturity and 7% coupon rate (coupons paid semi-annually)
Time value Personal Finance Problem You have S2.100 to invest today at 9% interest compounded annually a. Find how much you will have accumulated in the account at the end of (1) 4 years, (2) 8 years, and (3) 12 years . Use your findings in part a to calculate the amount of interest earned in (1) the first 4 years (years 1 to 4), (2) the second 4 years (years 5 to 8), and (3) the third 4 years...