Question

How much would you have to invest today to receive the following ? Calculate answer using the formuld and financial calculator methods, a) 4 12,500 in 7 years at 11 percent. Do not round calculations. Round fonal answer to a decimal places b) $ 16, 100 in 15 years at 10 percent. c) & 6, 250 each year for 14 years at 8%. d) $43,000 each year for 30 years at 6ro.

Answer 1

a.

Present Value = 12,500/(1.11)⁷ = $6,020.73

b.

Present Value = 16,100/(1.10)¹⁵ = $3,854.21

c.

PV = [FV = 0, PMT = 6,250, N = 14, I = 0.08]

PV = $51,526.48

d.

PV = [FV = 0, PMT = 43,000, N = 30, I = 0.06]

PV = $591,887.74