a
EAR = [(1 +stated rate/no. of compounding periods) ^no. of compounding periods - 1]* 100 |
? = ((1+4.2/(365*100))^365-1)*100 |
Effective Annual Rate% = 4.2892 |
Future value = present value*(1+ rate)^time |
3900 = Present value*(1+0.042892)^3 |
Present value = 3438.32 |
b
EAR = [(1 +stated rate/no. of compounding periods) ^no. of compounding periods - 1]* 100 |
? = ((1+4.9/(12*100))^12-1)*100 |
Effective Annual Rate% = 5.0116 |
Future value = present value*(1+ rate)^time |
3900 = Present value*(1+0.050116)^3 |
Present value = 3367.85 |
c
EAR = [(1 +stated rate/no. of compounding periods) ^no. of compounding periods - 1]* 100 |
? = ((1+5.2/(4*100))^4-1)*100 |
Effective Annual Rate% = 5.3023 |
Future value = present value*(1+ rate)^time |
3900 = Present value*(1+0.053023)^3 |
Present value = 3340.04 |
d
Future value = present value*(1+ rate)^time |
3900 = Present value*(1+0.054)^3 |
Present value = 3330.76 |
Helen plans to invest some money so that she has $3,900 at the end of three...
Betty plans to invest some money so that she has $3,800 at the end of three years. Determine how much should she invest today given the following choices: (Do not round intermediate calculations and round your final answer to the nearest penny.) a. 4.2 percent compounded daily. Amount required to be invested $ b.4.9 percent compounded monthly. Amount required to be invested $ C.5.2 percent compounded quarterly. Amount required to be invested $ d.5.4 percent compounded annually. Amount required to...
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Answer all these questions. Thank you!
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Problem 5.12 (Excel Video) Karen White is saving to buy a house in five years. She plans to put 20 percent down at that time, and she believes that she will need $29,000 for the down payment. If Karen can invest in a fund that pays 9.40 percent annual interest, compounded quarterly, how much will she have to invest today to have enough money for the down payment? (If...
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