Present value of deposits=PV=?
Quarterly interest rate=i=7%/4=0.0175
Number of quarters left=n=15*4=60
Future value of deposit=FV=$10000
We know that
PV=FV/(1+i)n=10000/(1+0.0175)60 =$3531.30
A woman who has just won $45,000 in a lottery wants to deposit enough of her...
Charlie, who is just 16 years old, won a lottery. However, the lottery does not pay out money until a person is at least 25 years old. Charlie hires a financial consultant and this consultant suggests that Charlie invest the money and then begin receiving monthly payments of 2500$ once he reaches age 25. The consultant also suggests that Charlie should protect himself from inflation by having his payments increase by 2.3% each year. Thus, the 12 monthly payments in...
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