ANSWER
FV=PV
where FV=Future Value,
PV =Present Value,
r=rate of interest,
t= time
CFD"s for 5 Year,
FV=PV (1+I)T
1ST YEAR END 1000 = FV = 1000 (1+0.10)5 =1000(1.1)5
= £1610.51
2ND YEAR END 4000=FV = 4000 (1+0.10)4 =4000 (1.1)4
= £5856.4
3RD YEAR END 9000 =FV = 9000 (1+0.10)3=9000 (1.1)3
=£11979
4TH YEAR END 5000 =FV = 5000 (1+0.10)2= 5000 (1.1)2
= £6050
5TH YEAR END 2000 =FV = 2000 (1+0.10)1= 2000 (1.1)1
= £2200
TOTAL= 1610.51 + 5856.4 + 11979 + 6050 +2200
= £27,695.91
You assume to credit the subsequent CFDs at the end of years 1 over 5, €1,000,...
solv the two questions please ution Completion Status QUESTION 1 With incessant compounding for a period of 16 year 1% for what is the estimated future value of €25.000 early investment? 1,418,145 167 €911,433.156 € 1.411,766 056 od €1,311,433.159 QUESTION 2 You assume to credit the subsequent CFDs at the end of years I over 5.61.000 64.000: 19,000 €5,000, and 2,000, correspondingly. However, at the end of year 6 how much will be the future value interest rate of 10...
1. Assume that it takes 11.5 years for $1,000 to accumulate to $3,000 if you earn 10% per year. What will happen to the length of time needed for $1,000 to accumulate to $3,000 if the interest rate increases? A. Stay the same? B. Impossible to determine C. Increase D. Decrease 2. Assume that it takes an investment of $3,507 today to accumulate to $5,000 in 3 years when the interest rate is 12% per year compounded quarterly. How much...
You deposit $1,000 at the end of the year (k = 0) into an account that pays interest at a rate of 6% compounded annually. Two years after your deposit, the savings account interest rate changes to 12% nominal interest compounded monthly. Five years after your deposit, the savings account again changes its interest rate, this time the interest rate becomes 8% nominal interest compounded quarterly. Eight years after your deposit, the saving account changes its rate once more to...
engnieering economy Note: Show all of your work to arrive at a final result and for full credit. 1) If a person places $10,000 in an account that pays 10% compounded annually, how much money will be in the account after 10 years? 2) Three years ago a person borrowed $15,000 at an interest rate of 10% compounded annually and agreed to pay it back in equal payments over an 8 year period. This same person now wants to pay...
Problem 1. If you deposit $1,000 every 2 years starting now over 10-year period, how much money will you accumulate if annual interest rate is 10% compounded monthly? Problem 2. How long will it take for money to double at 10% nominal interest rate, compounded continuously? Problem 3. If $100 in year 0 will be worth $110 a year later, and it was worth $90 a year ago compute the interest rate for the past year and the interest...
1) You plan to deposit $1,000 every month into an account paying 6% compounded monthly for the next 5 years. How much will you accumulate over this five year period? 2) What is the future value interest factor of an annuity for #1? 3) If you plan to make annual payments instead of the monthly payments indicated in #1 above, how much will you have to deposit annually to have the same sum accumulated in five years as in #1...
1. Determine the discount rate assuming the present value of $940 at the end of 1-year is $865? 2. $9,800 is deposited for 12 years at 5% compounded annually, determine the FV? 3. If $2,800 is discounted back 4 years at an interest rate of 8% compounded semi-annually, what would be the present value? 4. Consider a newlywed who is planning a wedding anniversary gift of a trip to Canada for her husband at the end of 10 years. She...
Assume you have a liability with three required payments: $3,000 due in 1 year; $2,000 due in 2 years; and $1,000 due in 3 years. (a) What is the Macaulay duration of this liability at a 20% (annually compounded) rate of interest? (b) What about at a 5% (annually compounded) rate of interest?
Problem 4 Company ABC has an investment stream, S(n), over 2 years that can be represented as a continuous first degree polynomial function as given in the below figure for year 1 and year 2 (1) If a continuously compounded interest is applied to the instantaneous cash flow investment stream, determine the future worth of the investment at the end of year 6 Investment Stream $1,000 /year Investment Stream, $/year Time, years (2) If the investment stream was abruptly discontinued...
An investment pays $1,000 at the end of year 1, $1,000 at the end of year 2 $2,000 at the end of year 3. $3,000 at the end of year 4, and $5,000 at the end of year 5. If the interest rate is 5%, what is the present value of this series of payments? O $11,015.77 O $10,943.27 O $9,972.82 O $12,000.00