4. If your goal is to have $10,000 in a bank account in 12 years at...
4. If your goal is to have $10,000 in a bank account in 12 years at an interest rate of 6%, how much money must you invest per year? a. What type of problem is this: lump sum or annuity?
b. Fill in each of the following (Note: one of the answers is unknown – write ?): PV = FV = CF = t = r =
c. Draw a time line
d. Write the appropriate formula.
e. Solve the problem.
Homework Answers
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4. If your goal is to have $10,000 in a bank account in 12 years
at...
You want to know how much $10,000 invested today is going to be worth 10 years...
You want to know how much $10,000 invested today is going to be worth 10 years from now. Which type of time value of money calculation should be used to solve this problem? present value of an annuity future value of an annuity present value of a lump sum future value of a lump sum
You agree to deposit $500 at the beginning of each month into a bank account for...
You agree to deposit $500 at the beginning of each month into a
bank account for the next 24 months. At the end of the 24th month,
you will have $13,000 in your account. If the bank compounds
interest monthly, what annual interest rate will you have
earned?
Note: Please post the formula used to solve the question and
list the steps taken to reach the answer, please don't use excel. I
provided a list of formulas, please state the...
7. Calculate annuity cash flows Your goal is to have $10,000 in your bank account by...
7. Calculate annuity cash flows Your goal is to have $10,000 in your bank account by the end of eight years. If the interest rate remains constant at 10% and you want to annual identical deposits, you'll have to deposit into your account at the end of each year to reach your goal. If your deposits were made at the beginning of each year rather than an at the end, the amount of your deposit would change by still wanted...
Jessica wants to accumulate $10,000 by the end of 6 years in a special bank account,...
Jessica wants to accumulate $10,000 by the end of 6 years in a special bank account, which she had opened for this purpose. To achieve this goal, Jessica plans to deposit a fixed sum of money into the account at the end of the month over the 6-year period. If the bank pays interest at the rate of 6% per year compounded monthly, how much does she have to deposit each month into her account? (Round your answer to the...
You agree to deposit $500 at the beginning of each month into a bank account for...
You agree to deposit $500 at the beginning of each month into a
bank account for the next 24 months. At the end of the 24th month,
you will have $13,000 in your account. If the bank compounds
interest monthly, what annual interest rate will you have
earned?
Note: Only use the formula listed and show the steps of how you
reached the answer, I don't need to know just the answer, I'm
trying to learn. Thank you. Don't use...
Your goal is to have $17,500 in your bank account by the end of eight years....
Your goal is to have $17,500 in your bank account by the end of eight years. If the interest rate remains constant at 9% and you want to make annual identical deposits, how much will you need to deposit in your account at the end of each year to reach your goal? (Note: Round your answer for PMT to two decimal places.) If your deposits were made at the beginning of each year rather than an at the end, by...
Time Value of Money Spreadsheet Example 4 Module IV Name: Date: 6 7 8 Question 1 9 Question 2 10 Question 3 11 Question...
Time Value of Money Spreadsheet Example 4 Module IV Name: Date: 6 7 8 Question 1 9 Question 2 10 Question 3 11 Question 4 12 Question 5 13 Question 6 14 Question 7 15 Question 8 16 Question 9 17 Question 10 18 19 20 Single Amount or Annuity 21 Periodic Interest Rate 22 Number of Periods 23 24 25 Present Value of Single Amount 26 27 Future Value of Single Amount 28 29 Future Value of An Annuity...
(1 point) A bank account earns 11 percent interest compounded continuously. At what (constant, continuous) rate...
(1 point) A bank account earns 11 percent interest compounded continuously. At what (constant, continuous) rate must a parent deposit money into such an account in order to save 100000 dollars in 13 years for a child's college expenses? rate = (dollars/year) If the parent decides instead to deposit a lump sum now in order to attain the goal of 100000 dollars in 13 years, how much must be deposited now? amount = (dollars)
I need help on question 2. MODULE IV: TIME VALUE OF MONEY INTRODUCTION The time value...
I need help on question 2.
MODULE IV: TIME VALUE OF MONEY INTRODUCTION The time value of money analysis has many a lysis has many applications, ranging from setting hedules for paying off loans to decisions about whether to invest in a partie financial instrument. First, let's define the following notations: I = the interest rate per period Na the total number of payment periods in an annuity PMT = the annuity payment made each period PV = present value...
4. Calculate annuity cash flows Your goal is to have $20,000 in your bank account by...
4. Calculate annuity cash flows Your goal is to have $20,000 in your bank account by the end of nine years. If the interest rate remains constant at 10% and you want to make annual identical deposits, you'll have to deposit into your account at the end of each year to reach your goal. If your deposits were made at the beginning of each year rather than an at the end, the amount of your deposit would change by _...
You agree to deposit $500 at the beginning of each month into a
bank account for the next 24 months. At the end of the 24th month,
you will have $13,000 in your account. If the bank compounds
interest monthly, what annual interest rate will you have
earned?
Note: Please post the formula used to solve the question and
list the steps taken to reach the answer, please don't use excel. I
provided a list of formulas, please state the...
7. Calculate annuity cash flows Your goal is to have $10,000 in your bank account by the end of eight years. If the interest rate remains constant at 10% and you want to annual identical deposits, you'll have to deposit into your account at the end of each year to reach your goal. If your deposits were made at the beginning of each year rather than an at the end, the amount of your deposit would change by still wanted...
You agree to deposit $500 at the beginning of each month into a
bank account for the next 24 months. At the end of the 24th month,
you will have $13,000 in your account. If the bank compounds
interest monthly, what annual interest rate will you have
earned?
Note: Only use the formula listed and show the steps of how you
reached the answer, I don't need to know just the answer, I'm
trying to learn. Thank you. Don't use...
Time Value of Money Spreadsheet Example 4 Module IV Name: Date: 6 7 8 Question 1 9 Question 2 10 Question 3 11 Question 4 12 Question 5 13 Question 6 14 Question 7 15 Question 8 16 Question 9 17 Question 10 18 19 20 Single Amount or Annuity 21 Periodic Interest Rate 22 Number of Periods 23 24 25 Present Value of Single Amount 26 27 Future Value of Single Amount 28 29 Future Value of An Annuity...
(1 point) A bank account earns 11 percent interest compounded continuously. At what (constant, continuous) rate must a parent deposit money into such an account in order to save 100000 dollars in 13 years for a child's college expenses? rate = (dollars/year) If the parent decides instead to deposit a lump sum now in order to attain the goal of 100000 dollars in 13 years, how much must be deposited now? amount = (dollars)
I need help on question 2.
MODULE IV: TIME VALUE OF MONEY INTRODUCTION The time value of money analysis has many a lysis has many applications, ranging from setting hedules for paying off loans to decisions about whether to invest in a partie financial instrument. First, let's define the following notations: I = the interest rate per period Na the total number of payment periods in an annuity PMT = the annuity payment made each period PV = present value...
4. Calculate annuity cash flows Your goal is to have $20,000 in your bank account by the end of nine years. If the interest rate remains constant at 10% and you want to make annual identical deposits, you'll have to deposit into your account at the end of each year to reach your goal. If your deposits were made at the beginning of each year rather than an at the end, the amount of your deposit would change by _...
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