Question

please complete all 3 required parts to the question.

Problem 5-6 (Algo) Solving for unknowns (L05-3,5-9) The following situations should be considered independently. (FV of $1. PV of $1. FVA of $1. PVA of $1. FVAD of $1 and PVAD of $1 (Use appropriate factor(s) from the tables provided.) 1. John Jamison wants to accumulate $63,968 for a down payment on a small business. He will invest $32,000 today in a bank account paying 8% interest compounded annually. Approximately how long will it take John to reach his goal? 2. The Jasmine Tea Company purchased merchandise from a supplier for $32,802. Payment was a noninterest-bearing note requiring Jasmine to make five annual payments of $8,000 beginning one year from the date of purchase. What is the interest rate implicit in this agreement? 3. Sam Robinson borrowed $14,000 from a friend and promised to pay the loan in 12 equal annual installments beginning one year from the date of the loan. Sam's friend would like to be reimbursed for the time value of money at a 9% annual rate. What is the annual payment Sam must make to pay back his friend? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 John Jamison wants to accumulate $63,968 for a down payment on a small business. He will invest $32,000 today in a bank account paying 8% interest compounded annually. Approximately how long will it take John to reach his goal? (Do not round intermediate calculations. Round the value of "n" to the nearest whole number.) Present Value: Future Value 1 ( Required 1 Required 2 >

Answer 1

Requirement-1				Calculation
	Present value	32000
	n =	9	Years	(32,000*1.08^n = 63,968) 1.08^n = 1.999, from the table n = 9 years
	I =	8%
	Future value	63968
Requirement-2
	Present value	32802
	n =	4
	I =	11%	from the table, annuity value of 4 years.
	Annuity payment	8000
Requirement -3
	Table or calculator function	7.16073
	Present value	14000
	n =	12
	I =	9%
	Annuity payment	1955

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