Question

You decide to save up for a big trip and deposit 882 in a special vacation account today. If your account earns 4.94% annually, how much will you have available to spend in 8 years? Round to two decimal places (Ex. $0,000.00)

If you want to have $2,971 in 8 years, how much money must you put in a savings account today? Assume that the savings account pays 5.1% and it is compounded annually. Round to two decimal places (Ex. $000.00)

Your company has received a $50,000 loan from an industrial finance company. The annual payments are $6,202.70. If the company is paying 9 percent interest per year, how many loan payments must the company make?

15

13

12

19

Answer 1

a)	Future value in 8 years	=	P*(1+i)^n		Where,
		=	882*(1+0.0494)^8		P	$         882.00
		=	$ 1,297.17		i	4.94%
					n	8
b)	Present value	=	A*(1+i)^-n		Where,
		=	2971*(1+0.051)^-8		A	$     2,971.00
		=	$ 1,995.63		i	5.10%
					n	8
c)	Number of period	=	=NPER(rate,pmt,pv)		Where,
		=	15		rate	9%
					pmt	$     6,202.70
					pv	$       -50,000