Question

please answer correctly thanks

T ELEIRO ILU, U UNUSTAPLE 1. An entrepreneur must have $25,000 in 3 years to start a new business. (a) Calculate the amount that must be deposited now, assuming a 6% annual rate of return. 25,000 25,000 (1.063 6.06 : 11,151.88 1.0v (b) Apply the financial function command (with each numerical value reported in correct sequence) that would solve this problem. -585000) 2. A mother plans to give her child $7,000 at the end of each of the next 8 years. The money will be deposited in an account that earns an annual rate of 9%. (a) Calculate the value of this account in 8 years. 7,000 ( n . 5 203.25 1.09 (b) Apply the financial function command (with each numerical value reported in correct! sequence) that would solve this problem. =FV1.09,8, 7000,00)

Answer 1

rate positively ..

Ans 1 a)
	Amount to deposit =			25000/(1+6%)^3
				20990.482
Ans 1 b)	Financial function =
	=PV(6%,3,0,-25000,0)			$20,990.48
Ans 2 a)
	Year	Payment	PVIF @ 9%	present value
	1	7000	0.9174	6,422.02
	2	7000	0.8417	5,891.76
	3	7000	0.7722	5,405.28
	4	7000	0.7084	4,958.98
	5	7000	0.6499	4,549.52
	6	7000	0.5963	4,173.87
	7	7000	0.5470	3,829.24
	8	7000	0.5019	3,513.06
				38,743.73
	Ans =	38,743.73
Ans 2 b)	Financial function =
	=PV(9%,8,-7000,0,0)			$38,743.73