Question

Suppose you receive $180 at the end of each year for the next three years. a. If the interest rate is 9%, what is the present value of these cash flows? b. What is the future value in three years of the present value you computed in (a)? C. Suppose you deposit the cash flows in a bank account that pays 9% interest per year. What is the balance in the account at the end of each of the next three years (after your deposit is made)? How does the final bank balance compare with your answer in (b)? C. Suppose you deposit the cash flows in a bank account that pays 9% interest per year. What is the balance in the account at the end of each of the next three years (after your deposit is made)? end of year one is $ 180. (Round to the nearest cent) The balance in the account at th The balance in the account at th lower than $590.06. (Round to the nearest cent.) How does the final bank balanc equal toanswer in (b)? (Select from the drop-down menu and ignore small differences due to rounding.) The final bank balance in (c) is 376.20 (Round to the nearest cent.) higher tharn the bank balance from pat (b)

Answer 1