Question

2.It is now January 1, 2019, and you will need $1,000 on January 1, 2023, in 4 years. Suppose you can deposit only $200 each January 1 from 2020 through 2023 (4 years). What interest rate, with annual compounding, must you earn to end up with $1,000 on January 1, 2023?

3. It is now January 1, 2019, and you will need $1,000 on January 1, 2023, in 4 years. Your father offers to give you $400 on January 1, 2020. You will then make six additional equal payments each 6 months from July 2020 through January 2023. If your bank pays 8% compounded semiannually, how large must each payment be for you to end up with $1,000 on January 1, 2023?

Answer 1

Giren data from the problem Jan 1, 2019 An 4 years $ 1opo on jan 1, 2023 > 2019 and you w0911 need and you can 1200 each Januasy I form 2020 through 2003 And farm to end up worn & 1000 on jan 1, 2023 To calculate ankesest satı we have Interest rate - Canatuonty amount anual depart (1/No. of pe ] a cohen Ancru894y amount = $1000 Inatal anvestment = $750 Number of years of deposit = 3 years By equation, we get substituting all values an above alls) anterest rates (0001450) - oleresc Tatu = 0.1006 s 10.064. Esmes tau - [to-o6 - 1.